Its analysis also found that just 3.5 per cent of people searching for a mortgage were eligible for every deal on the market.
According to Experian, 22 per cent of those using pre-qualification comparison websites to find a mortgage met the initial qualifying criteria for every lender on the market.
But this figure fell to 3.5 per cent once their affordability for their desired loan was considered with an eligibility check.
The analysis also showed that 27 per cent were eligible for a mortgage but only for a reduced amount to meet the lender’s affordability requirements. The figure rose to 31 per cent for those looking to remortgage with additional borrowing requirements.
Comparison sites and digital brokers
Some 11,000 people were included in the analysis which examined eligibility inquiries made on price comparison websites and digital broker channels.
However, in its Mortgage Market Study, the Financial Conduct Authority (FCA) said digital eligibility tools were more likely to focus on consumers with straightforward needs and only give “yes” or “no” responses, discouraging those with complex situations from seeking further advice.
This may ultimately lead to higher costs for consumers as the FCA’s study suggested that mortgages with less demanding eligibility criteria were likely to be more expensive. It also found that a lack of clarity surrounding criteria meant customers were left paying extra for terms which did not apply to them.
Lisa Fretwell, managing director of data services at Experian, said: “People don’t want to leave anything to chance when they’re trying to buy their dream home. Pre-qualification websites strengthen their position, signposting mortgages which they will find affordable and be accepted for, so they can get the loan they want.
“Mortgage lenders are using new services to increase their acceptance rates. Pre-qualification connects them with people who are eligible to borrow from them, while Open Banking services allow them to quickly understand someone’s income and outgoings.”