Bluestone defines‘specialist lender’as a lender that makesdecisions based on a customers’ individual circumstances,so if they've failed a credit score or don't fit the traditional high street lenders profile.
Over a third of mortgage brokers(34%) have referred more than a quarter of their client base to a specialist lenderinthe last 12 months, Bluestone Mortgagesfound.
Of these, nearly a quarter (24%) referred between 26% and 50% of their clients and 10% referred over half to a specialist lender. Nearly half of brokers (47%) referred between 11% and 25% of their customers.
Bluestone defines‘specialist lender’as a lender that makesdecisions based on a customers’ individual circumstances,so if they've failed a credit score or don't fit the traditional high street lenders profile.
Steve Seal, director of sales and marketing at Bluestone Mortgages, said: “It’s positive to see that brokers are referring a fair proportion of their client base to specialist lenders.
“Whether borrowers are employed, self-employed, contractors or freelancers, the specialist lending market is able to cater for all, as well as dealing with more complex applications.
“Whilst brokers are taking action to help those who may otherwise be unable to secure high-street lending, there are still some who remain cautious of specialist lending, as they don’t want to deal with complex customers or unfamiliar lenders.
“However, this is actually a great opportunity for brokers to engage with a growing pool of customers who have unique circumstances which can’t always be addressed by mainstream lending.
“It is vital that the market continues working together to secure the best customer outcomes, and specialist lending has a key role to play here.”
When asked about customer profiles, half of brokers said that the typical employment status of a specialist client was self-employed.
A broker’s specialist client base was split relatively evenly between first-time buyers (55%), remortgagers (53%) and homemovers (46%). Interestingly though, only 23% were last-time buyers.
One of the primary reasons why brokers refer their clients to a specialist lender is because they fall outside of mainstream lending criteria, with over half (53%) of brokers stating this.
Other reasons included irregular and multiple income streams (43% and 42% respectively) and clients with impaired credit history (42%).
Interestingly, only a quarter of brokers (23%) selected a County Court Judgement (CCJ), bankruptcy or Individual Voluntary Agreement (IVA) as one of the main reasons they would refer their client to a specialist lender.
