85% of self-employed people across the country say their income hasn’t yet returned to pre-pandemic levels, resulting in more people having to postpone our cancel plans to moving onto or the up the property ladder.
The Mortgage Lender carried out research among 1,000 UK-based self-employed people, who either own their home or want to, in March.
The survey revealed 28% of self-employed people have seen their income slashed by more than half over the last year because of the pandemic. A further 16% said they had suffered income losses of between a quarter and 50%.
As a result, 51% believe it is now more difficult for a self-employed borrower to get a mortgage. And a further 53% claim that their self-employed status has deterred them from even applying for one.
However, there were also self-employed people that bucked the trend when it came to income during the pandemic.18% of the self-employed panel hadn’t experienced any change to their income and 14% said it had increased.
Steve Griffiths, The Mortgage Lender’s sales and product director, said: “When we launched our new residential range earlier in the year we did so with the self-employed, complex income borrowers and credit impairment front of mind, because these are the people who have been most affected by the pandemic.
“Even before the pandemic self-employed people felt let down by the mortgage market. In 2018, as part of a special report called The Self-Employed Economy, we found that 1m (21%) self-employed people had reconsidered their employment situation because of the uncertainty of securing a mortgage. Today, the statistics show even more pessimism, with over half believing their chances of being given a mortgage are so slim they don’t even think it’s worth applying.
“Now more than ever specialist lenders need to have criteria that caters for a wide range of customer circumstances and recognise that the last 12 months has been financially difficult for many people.”