A recent report from Nottingham Building Society reveals a pressing need for the mortgage market to adapt to borrowers with non-traditional incomes. With 88% of mortgage brokers indicating that lenders are too slow to respond to changing borrower needs, the call for collaboration between brokers and lenders has never been louder.
The Doorstep Divide report surveyed over 500 brokers and found that nearly seven in ten expect borrowers with complex income situations to become the norm. Alarmingly, 90% of brokers believe lenders should prioritise products for a broader range of financial circumstances.
Viable cases often stall at the initial affordability assessment or due to documentation requirements, with differing evidence demands between lenders cited as a significant barrier. This is compounded by a consumer survey showing that over half of UK adults believe those with non-traditional incomes face harsher judgment.
The report highlights that more than a quarter of prospective borrowers have paused or abandoned their mortgage applications due to income-related concerns. Additionally, 89% of borrowers feel lenders should focus more on current stability rather than past credit issues.
To address these challenges, the report proposes six key recommendations, including standardising how complex income is evidenced, integrating verified rental payment data into assessments, and recognising overseas credit histories.
Aaron Shinwell, Chief Lending Officer at Nottingham Building Society, emphasises the need for clarity and fairness in the mortgage process, urging lenders to consider the full picture of a borrower's financial situation.
As the mortgage landscape evolves, embracing these recommendations could ensure a more inclusive and equitable market for all borrowers.
Want to hear more? Join Mal & Matt on the Property AI Report Podcast each week!
Access from your preferred podcast provider by clicking here
Made with TRUST_AI - see the Charter: https://www.modelprop.co.uk/trust-ai