Increasing living costs are a major concern for disadvantaged borrowers
Increasing costs of living are the top concern for borrowers who are self-employed or have bad or no credit score at all, data by Bluestone Mortgages suggests.
Main research takeaways
Researchers at Bluestone analysed the mortgage market figures and revealed rising living costs as the major concern for 67% of disadvantaged borrowers for the year ahead.
Financial stability, increasing interest rates, and lack of work came next with 35%, 33%, and 30% accordingly. Around 34% of these borrowers who traditionally struggle with securing a mortgage expect their financial situation to stay on the same level.
However, 18% of borrowers think their finances will be worse in 2022, while 40% predict their financial state to improve.
As for those having no credit score, 30% think their finances will suffer this year ahead. A similar figure for self-employed borrowers is 17%.
Steve Seal at Bluestone Mortgages predicts prices for everyday items, increasing energy bills, and the upcoming rise to National Insurance contributions will put additional pressure on the rising costs of living. Many buyers might put off the home buying process with fears of rejection, while some may have been already rejected because of more complex needs.
The expert says that those borrowers who cannot operate with high street lenders need to remember that there are many other offers available in the market. These lenders have to support the homeownership dreams of such borrowers and guide them on the correct path.
Whether they are self-employed or have a bad credit score, several opportunities in the market can help make the first and next step on the property ladder.