Brokers accuse lenders of ‘marginalising self-employed’
The vast majority of brokers (91 per cent) think that mainstream lenders had tightened their criteria for self-employed applicants, new research has found.
United Trust Bank commissioned the survey for a mortgage white paper titled ‘Growing opportunities for brokers in the specialist mortgage market’, which interviewed more than 100 mortgage brokers.
The respondents suggested that customers with ‘complex’ incomes, being either self-employed, sole traders or with multiple income sources will continue to grow and that having lenders with an appetite to cater for these customers is vital.
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Some 81 per cent of brokers believe that clients’ incomes have generally become more complex over the last 12 months.
In addition, 88 per cent of mortgage brokers believe that self-employed customers, specifically those who took advantage of legitimate Covid-19 government support, are being marginalised by mainstream mortgage lenders.
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“Covid-19 has changed how we work,” United Trust Bank director of mortgages Buster Tolfree said in the foreword to the report.
“Many people have become self-employed. What started out as a ‘side hustle’ may have become a significant second income.
“House price increases have prompted lenders to stretch income multiples and find new ways to accommodate affordability tests. Current and future stresses on personal finances, dubbed the cost-of-living crisis by media, will inevitably hit some people where it hurts most where borrowing is concerned – in their credit score.
“Everyone who finds themselves affected by these circumstances should still have the opportunity to own or remortgage their home or buy another one (or two!) for investment if they so wish. Mainstream lenders don’t disagree with the sentiment, they just don’t want, or need, to support them with their money.”
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