According to research from The Mortgage Lender (TML), which surveyed around 2,000 non-traditional workers – including self-employed workers, freelancers, and gig economy workers – a quarter said that they had never applied because they would not be approved.
A further 18% said that they had never applied for a mortgage as they had heard it was more difficult to secure a mortgage if they were self-employed.
TML said this showed that the assumption that non-traditional workers would find it more challenging to secure a mortgage was still pervasive.
The research found that there was a lack of awareness of the mortgage process among non-traditional workers, with 10% saying they did not know how to apply for a mortgage and 8% did not know who to speak to about securing one.
An additional 8% said their business was under two years old so they did not think they would have the right documents to be approved.
More than a third of non-traditional workers said that they had not built up an adequate deposit, 14% were waiting for interest rates to fall and 3% said they had waited for the general election to push ahead with their plans.
Approximately 4% said they needed some form of support, such as shared ownership, to get onto the property ladder.
Around 15% of non-traditional workers said that they preferred renting as it was more flexible and 13% said they were not ready for the responsibility of owning a home.
The report found that seven in 10 had been dissuaded due to bad experiences of friends or colleagues, and a further 9% are saving for other items first.
Sara Palmer, distribution director at TML, said: “We as an industry must deconstruct these ideas around the mortgage application process and make it more accessible to non-traditional and self-employed workers. Many of these individuals could be great candidates for a lender, but all too often the complexities around the process for self-employed individuals is putting them off from even trying.”
She added: “As a lender for real-life people, we are continuously revising and updating our services to provide the best possible support for our customers, which also includes giving non-PAYE workers the assurance that their career should not be a barrier to them reaching their property goals.
“These are individuals that are offering vital contributions to the UK economy, and it’s important that we, as a lender, can support them and offer them a smooth service comparable to more traditionally employed people.”
