Adverse credit searches rise by over 90 per cent in 2023

Research from Twenty7tec, along with Pepper Money in a co-branded version of its Specialist Lending Study, shows that adverse credit accounted for 26.8 per cent of the top criteria, which is up from the previous year.

The most popular adverse criteria searches were for satisfied defaults, missed credit payments, and satisfied county court judgments (CCJs).

The Specialist Lending Study said that the main reasons customers had adverse credit on their profile are missed credit payments, defaults and debt management plans.

Nakita Moss, team manager for lender relationships at Twenty7tec, said: “2023 was our busiest ever year for mortgage searches. By mid-November, we’d already surpassed 2022’s record figures and then had our busiest-ever December on top of that.

“The increase in mortgage searches can be largely attributed to heightened uncertainty surrounding interest rates. It doesn’t necessarily translate directly into increased house purchases or remortgage, but rather, it reflects the frequent base rate changes we saw last year, lenders making necessary adjustments to their rates and product attributes, and advisers staying informed to ensure they recommend the most suitable options for their customers.

“In 2023, we saw a notable surge of 90.7 per cent rise in the actual number of adverse credit criteria searches, marking it as the predominant criteria selections used by advisers on our platform. That said, there was a significant increase overall in the utilisation of our criteria tool alongside product searches via Twenty7tec in 2023, as more and more advisers used our advanced technology.”

Rob Barnard (pictured), director of intermediary relationships at Pepper Money, added: “More than a quarter of the adult population in the UK have some history of adverse credit. Missed credit payments are no longer isolated incidents. They are part of the norm, and we need to normalise the conversation about the options for those people with adverse credit when it comes to getting a mortgage.”