Complex cases on the rise as advisers complete record number of searches in March

Legal & General’s SmartrCriteria tool tracked a record number of searches last month after volumes jumped 17% between February and March. However, while overall activity continued to increase, the proportion of searches for borrowers with financial complications, such as credit impairments, continued to rise.

SmartrCriteria also tracked a 40% uplift in searches for lenders willing to consider borrowers with previous repayment defaults.

Activity in the housing market continued to increase in March, with Legal & General Mortgage Club’s SmartrCriteria tool tracking a record number of searches after volumes jumped by 17% compared to the previous month. This follows HMRC’s latest property transaction data which revealed that residential transactions doubled year on year in March 2021.

However, while activity volumes reached new heights, data from SmartrCriteria searches showed an increase in searches for borrowers with financial complications, such as credit impairments, furloughed income, or multi-stream income. This is reflective of the continued impact of the pandemic in complicating borrowers’ personal finances.

SmartrCriteria’s most searched criteria point last month related to mortgages suited to borrowers with a satisfied default, indicating that many borrowers have retrospectively settled missed payments recently. These searches increased by over 40% between February and March whilst searches for borrowers with outstanding missed payments (unsatisfied defaults) also jumped by 28%.

Similarly, demand for furlough-friendly mortgages remained high and, despite overall volumes having dipped by just over 9%, this was advisers’ second most searched criteria point in March. Furthermore, searches for applicants with a second job increased by 51% last month, a further indication of financial strain on customers.

SmartrCriteria was launched by Legal & General in 2019 and has over 8000 registered advisers, around a third of the intermediary market. The service is free to use, regardless of whether an adviser is a Club member or not. 

While it is clear that various government incentives are driving many to push ahead with their homeownership plans, the rising number of searches for lenders who will accept applicants with credit impairments and multiple income streams shows that the economic impact of the crisis continues to be felt by many. While activity in the housing market may be high, advisers are increasingly needing powerful tools to help them progress complex cases.

Our sourcing technology continues to be an ally to intermediaries, helping them match clients with lenders no matter their borrowing needs. We remain committed to introducing further improvements to the proposition and look forward to delivering additional product enhancements to help intermediaries through this current busy period and beyond.

Clare Beardmore, Head of Mortgage Transformation and Operations, Legal & General Mortgage Club

Notes to editors

About Legal & General 

Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with international businesses in the US, Europe, Middle East and Asia. With over £1.1 trillion in total assets under management, we are the UK’s largest investment manager for corporate pension schemes and

a UK market leader in pension risk transfer, life insurance, workplace pensions and retirement income.

About Legal & General Mortgage Club

Legal & General Mortgage Club is one of the UK’s largest and longest-running mortgage clubs, completing £667bn of mortgages since 1995. We are involved in nearly one in five of all mortgages in the UK, in addition to nearly one in three of all intermediated mortgages. The Mortgage Club prides itself on adding value to the adviser community by working closely with new and existing lenders to deliver great products, pricing and criteria. Our popular SmartrFit tool, which is free to advisers, combines an affordability calculator with lender criteria to provide accurate, quick results, to help make advisers jobs easier so they can spend time where it matters.