Mortgage affordability rules are hampering borrowers’ career ambitions and entrepreneurial pursuits, new research shows.
A survey of 500 estate agents by Nottingham Building Society found that concerns about meeting lenders’ income requirements are holding borrowers back or delaying their plans.
More than one in five agents (22%) say clients have had to take extra steps to prove affordability due to their career choice or working pattern, while 17% report cases where lenders have rejected applicants outright due to income complexity.
Another 16% of agents say clients have experienced previous problems with mortgage applications related to their career.
Just under one in five agents (18%) say clients have had to reconsider their chosen career, pursuing entrepreneurial ventures or passion projects because they fear it would harm their mortgage chances.
Meanwhile, 15% report that customers are concerned that starting their own business would jeopardize their ability to purchase a home.
Despite these hurdles, tailored advice helps borrowers; 17% of agents say their clients have become more confident as a result.
Meanwhile, 15% of advisors say some lenders are showing more flexibility around income or employment status.
Nottingham Building Society chief lending officer Aaron Shinwell says: “Careers in Britain are more varied than ever, but mortgage rules still favor the traditional 9-5.
“Our research shows that too many aspiring homeowners are reluctant to make life decisions – whether that’s taking a dream job, starting a business or pursuing a passion – because current lending models don’t take into account 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 customers new confidence.
“That balance between prudence and innovation is critical – and it underlines the importance of lenders continuing to develop their products and criteria.
“Our priority is to ensure that borrowers are not punished because of ambition or circumstances.”