Almost a third of self-employed mortgages have been deemed as unaffordable in 2021, according to Mortgage Broker Tools.
Almost a third of self-employed mortgages have been deemed as unaffordable in 2021, according to Mortgage Broker Tools.
Research by MBT shows that 71% of self-employed cases processed through its platform in January 2021 were affordable, with 27% deemed to be unaffordable based on the required loan amount.
It also found that the average maximum loan offered to self-employed mortgage applicants is £221,400 - a decrease of 3% from the last peak in August 2020.
Whilst the minimum loan available to the self-employed recovered to £118,800, a 45% increase on its lowest point last April and a rise of 43% on November’s figures.
During a survey, it was revealed that 80% of self-employed Brits have been rejected when applying for a mortgage, 36.6% of applicants have faced at least one rejected, and 32.8% were rejected because their credit rating was not good enough.
David Baird, mortgage and protections advisor at Aventur Wealth, said: “COVID-19 has had a huge impact on self-employed mortgages as we have seen increased discrepancy in the market.
“From one major lender (Santander) restricting all lending for S/E applicants to 60% (In January - now at 75%) to others carrying on as normal it has caused more confusion for the average buyer.
“Personally I have not seen a decline in acceptance rates, instead it has caused an increase in time taken on my part in researching the right lender for the right applicant.”
