In our recent report The Self-Employed Economy we exposed that the majority of the mortgage market is letting down those who have decided to become their own boss and consequently, missing out on a potential £8bn opportunity.
Self-employed people are generally pretty disappointed with most mortgage lenders. More than a quarter (26 per cent) admit they would live in another property if they thought they would be treated the same as an employed person when applying for a mortgage.
Twenty per cent believe they would be refused a mortgage because they are self-employed.
And 71 per cent of the self-employed people we asked said they felt discriminated against because of their employment status.
What’s more it’s not just these potential borrowers that are missing out. Narrow-minded lenders are too and that’s a missed opportunity to the tune of potentially £8bn.
We’ve got 27.1m households in the UK, 65 per cent, or 17.6m of those are homeowners and if the proportion of homeowners who are self-employed is consistent with self-employment as a whole that means there are 2.65m self-employed homeowners.
If 26 per cent of those thought they could get the same mortgage they would if they were employed they would move.
That’s an extra 690,000 home movers and 690,000 potential customers for mortgage lenders. Even if you take a very conservative estimate and say 50,000 choose to move in any one year, with an average house price of £230,280 and LTV of 70 per cent, there is a demand in the market for more than £8bn in loans that isn’t currently being fulfilled.
For us being self-employed isn’t a barrier. Instead, being self-employed is normal – it’s real life.
We count among our self-employed customers a vlogger, a jockey, the odd professional football player and manager and plenty of contract workers.
So, if you ride horses for a living or Vlog that’s fine by us even if the other lenders haven’t quite caught up.