New data has indicated mortgage brokers are becoming more flexible as they adjust to the strange economic circumstances that have arisen due to the pandemic.
Research by Knowledge Bank on the kind of online searches being undertaken by mortgage brokers has seen an increased number of inquiries relating to issues such as time in employment or missed payments.
The economic shock of the pandemic had a range of effects. Some lost their jobs, some went on furlough and have returned to work, while others used their time to plan a career change, with the latest Office for National Statistics (ONS) data showing that the majority of people taking up new jobs switched from another role rather than coming out of unemployment after redundancies.
The ONS stated: “Total job-to-job moves also increased to a record high, largely driven by resignations rather than dismissals, during the July to September 2021 period.”
Among the factors the pandemic has led brokers to consider are a larger number of people newly in self-employment and financially-stressed people who have taken advantage of the forbearance of lenders and landlords to miss mortgage or rent payments, but are now in a better situation.
That may mean people looking for a remortgage with current arrears will receive a much more sympathetic hearing than before as brokers take into account the exceptional circumstances that brought about such a situation.
Operations director at Knowledge Bank Matthew Corker commented: “Our analysis shows lenders have been reviewing a range of criteria recently, particularly in areas where brokers are searching.”
He added that the loosening of lending criteria is a clear indicator that brokers and lenders believe the economy is “returning to normal”, with this being reflected in the booming job market.
It remains to be seen how long this approach lasts, but for now, mortgage holders seeking a new deal ahead of a likely base rate rise - as flagged up in the Bank of England’s Monetary Policy Committee November meeting minutes - have good reason to be optimistic about securing one.
