Brokers have said they face difficulties placing certain mortgage cases because of “outdated” affordability rules, a survey found.
A poll of 500 mortgage brokers carried out by Nottingham Building Society found that applicants with non-standard incomes faced barriers when applying for a mortgage.
Some 22% of brokers said their clients had to take extra steps to prove affordability because of their career or working pattern, and 17% said some clients had been declined because of the complexity of their income.
A further 16% of respondents said clients had problems with mortgage applications in the past because of their career, and 14% said self-employed or freelance clients only sometimes got a mortgage without significant difficulty. The mutual said this revealed the different lender approaches.
Some brokers noted that clients were adjusting their lifestyles to improve their chances of getting a mortgage, with 18% saying clients had changed their plans to pursue certain jobs, entrepreneurial ventures or passion projects. Further, 15% said clients expressed concerns that starting their own business would be a disadvantage.
Clients were also receiving help to boost their chances, with a fifth of brokers saying clients relied on financial support from friends and family.
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Although brokers highlighted difficulties around clients with complex careers and incomes, 17% said tailored advice made clients more confident about the mortgage process and 15% of brokers said they were impressed when lenders were more flexible around income or employment status.
Current lending models don’t match modern work
Aaron Shinwell, chief lending officer at Nottingham Building Society, said: “Careers in the UK are more varied than ever, but mortgage rules still favour the traditional 9-5. Our research shows that too many aspiring homeowners are holding back on life decisions – whether that’s taking a dream job, starting a business or pursuing a passion – because current lending models don’t account for the realities of modern work.
“At the same time, there are encouraging signs that some lenders are adapting, with brokers reporting cases where tailored support or greater flexibility has given clients new confidence. That balance of caution and innovation is key – and it underlines the importance of lenders continuing to evolve their products and criteria.”
He added: “Our priority is ensuring borrowers aren’t penalised for ambition or circumstance. By working with brokers and innovating responsibly, the sector can open the door to more people and make the mortgage market fit for the 21st century.”