These include Together and Precise Mortgages from the end of May, with Kensington Mortgages and Vida Homeloans from June.
The online portal, combining robo- and live-broker advice, will automatically direct applicants to live brokers that specialise in advising those with lower credit scores for the first time.
The platform will automatically categorise borrowers into 1-5 credit profile tiers based on live credit data. These brokers will have deep knowledge of the data specialist lenders require in order to approve a mortgage.
This advice will be supplemented by new open banking technology that Mortgagegym plans to launch this summer, which will match live data from applicants’ bank accounts to lenders’ internal scorecards, potentially adding clarity on affordability.
Sizeable minority of mortgage applicants excluded from high street lenders
Mortgagegym found that around 39 per cent of its own online users do not meet the criteria of most traditional lenders and have a credit score of 720 or below, due to factors outside of their control.
For instance, many freelance workers will not be able to secure a high street mortgage.
Mortgagegym has also found that mortgage applicants with an annual salary of under £20,000 have the worst credit score and consequently face the highest cost of borrowing.
For example, a first-time buyer with a poor credit score could face paying £947.29 per month with a 5.79% two-year fixed rate. In contrast, a first-time buyer with a strong credit score could pay £608.40 per month with a 1.62% two-year fixed rate.
High street lenders struggle to adapt to borrowers with irregular income
John Ingram, co-founder of Mortgagegym (pictured), said that with the nature of work in Britain having transformed dramatically as traditional employment patterns have shifted and different lifestyles emerging, the mortgage industry has not kept up with the times.
He added: “A key driver in this shift has been the emergence of the gig economy, zero-hours contracts, a rise in self-employed and people working longer. Many high street lenders have been slow to adapt to such diverse credit cases and borrowers with irregular income.
“Most mortgage providers’ automated decision-making and rigid criteria mean that many people are locked out of the mortgage market. As a result, an emerging market of specialist lenders has stepped in to meet these needs and now we are bringing these offers to as wide an audience as possible.
“Our aim has always been to create a transparent digital marketplace to match mortgage borrowers with the right mortgage lenders, making the mortgage process smoother and easier. We recognise that the modern way of living means that people have different income streams and as such we can now offer tailored advice to everyone with the introduction of specialist lenders and our new eligibility tool.”