Monday, March 20th, 2017
With many mainstream and high street mortgage lenders maintaining their “hard and fast” rules and underwriting policies, many potential borrowers who have special requirements or complex circumstances (referred to by some as ‘mortgage misfits’) are effectively being excluded from the market unless they take mortgage advice.
There are some specialist lenders on the other hand that take a more flexible approach and are happy to consider almost everyone, including those on zero-hours contracts, those with an adverse credit history and the self-employed. Furthermore, as the mortgage market continues to recover, it can make a great deal of sense for prospective borrowers to access the new lenders that have entered this specialist market via a specialist broker.
One of the key reasons for the increase in the number of lenders now entering this niche area of the market is the changing profile of the average mortgage borrower. Factors include the increasing number of self-employed borrowers, borrowers working to a later age and borrowers with some previous poor credit issues.
The number of borrowers who had a CCJ registered against them for example grew to over 900,000 in 2016 compared to fewer than 750,000 in 2015. One of the main reasons for this is that companies such as utility providers and mobile phone companies are taking action against people much more quickly, in some instances without the customer even being aware of the serious consequences of such an action.
Additionally, recent changes in mortgage industry regulation have also seemingly failed to really address these non-standard groups of mortgage borrowers so targeted mortgage advice from a suitably qualified broker is “worth its weight in gold” as they will be able to determine which specialist lender is best suited given the available criteria.
By accessing a comprehensive panel of lenders, these brokers can ensure that prospective borrowers do not then need to make multiple applications to locate the lender that is likely to be the most appropriate one for them in all the circumstances.
Although many mainstream lenders openly state that they want to help self-employed borrowers, many only really want to help the straightforward applicants and given the way in which many self-employed borrowers structure their business this can prove problematic. For example, many limited companies often leave profit to accumulate within their businesses and many mainstream lenders tend not to consider retained profit in determining the amount that can be advanced.
Such complexities may explain why demand for mortgage advice from specialist brokers has continued to increase over the last 12 months, with around 80% of applicants now choosing to take advice rather than spending time and effort trying to find a solution for themselves.
Caboodle Finance, Birmingham are here to help you with any specialist mortgage advice you may require. Just click HERE to contact us or alternatively call 0121 308 9114 today.
Caboodle Financial Services Ltd
Mere Green House
46-48 Mere Green Road
West Midlands B75 5BT
Telephone: 0121 308 9114