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Self-employed incomes hit hardest by the pandemic

Wednesday, July 21, 2021

Eighty-five per cent of self-employed people in the UK say their income hasn’t yet bounced back to pre-pandemic levels, resulting in more abandoning their dreams of moving onto or the up the property ladder.

The research among 1,000 UK-based self-employed people, who either own their home or want to, was carried out by The Mortgage Lender in March.

The survey revealed 28 per cent of self-employed people have seen their income slashed by more than half over the last year because of the pandemic. A further 16 per cent said they had suffered income losses of between a quarter and 50 per cent.

Consequently, 51 per cent believe it is now more difficult for a self-employed borrower to get a mortgage. And a further 53 per cent claim that their self-employed status has deterred them from even applying for one.

But there were also self-employed people that bucked the trend when it came to income during the pandemic.

Eighteen per cent of our self-employed panel hadn’t experienced any change to their income and 14 per cent said it had increased.

Commenting on the research The Mortgage Lender sales and product director Steve Griffiths said: “When we launched our new residential range earlier in the year we did so with the self-employed, complex income borrowers and credit impairment front of mind, because these are the people who have been most affected by the pandemic.

“Even before the pandemic self-employed people felt let down by the mortgage market. In 2018, as part of a special report called ‘The Self-Employed Economy’ we found that 1m (21 per cent) self-employed people had reconsidered their employment situation because of the uncertainty of

securing a mortgage. Today, the statistics show even more pessimism, with over half believing their chances of being given a mortgage are so slim they don’t even think it’s worth applying.

“Now more than ever specialist lenders need to have criteria that caters for a wide range of customer circumstances and recognise that the last 12 months has been financially difficult for many people.”

Please note article content was accurate at time of publishing

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