New research commissioned by LendInvest of 1,000 people across the UK, focusing primarily on the self-employed and those with multiple or complex income streams, has highlighted how hard some are finding it to get a mortgage.
30% have been rejected for a mortgage, compared to 14% in the general population, while 35% agreed that there were not enough mortgage products available to suit their situation.
48% said they have been negatively impacted by the mortgage application process and 51% have changed their life choices, (stayed in a job they dislike, delayed retirement, delayed/cancelled plans to go self-employed) to improve the likelihood of application success.
Meanwhile, 43% believed they were less likely to become a homeowner due to the cost of living crisis.
LendInvest says the research conducted by market research firm Opinium, highlights the extent of the problems presented by the standard mortgage process for an important and undervalued segment of workers across the UK with more complex income streams than salaried employees. It also shows how the current range of mortgage products on offer from lenders is failing to meet the changing needs of prospective home-owners and buyers across the UK.
The findings reveal that self-employed individuals and workers with multiple or non-standard sources of income, as well as those with complex credit histories, think getting a mortgage is more difficult than:
- Moving home (19%)
- Arranging a wedding (14%)
- Parenting (13%)
- Applying for a new job (11%)
- Buying a car (6%)
- Opening a bank account (4%)
With 25% of respondents ranking getting a mortgage as the most difficult task, only flying a plane (49%) ranked as more difficult.
Esther Morley, managing director, residential mortgages at LendInvest, said: “The research confirms our long-held belief that the traditional high street mortgage model is not fit for purpose for a large proportion of the UK population and is failing to keep pace with the increasingly complex needs of prospective homeowners.
“An increasing number of people across the UK have different income streams that do not conform with outdated legacy platforms and processes, leading all too often to dispiriting ‘Computer Says No’-style responses. Many are left navigating a needlessly complicated, intrusive and stressful process, resulting in hardworking people being denied the dream of owning their own home and suffering unnecessary mental anguish.”