High street banks should have new criteria for FTBs and self-employed borrowers by 2022

High street banks should have new criteria for FTBs and self-employed borrowers by 2022


Making mortgage applications simpler and easier for the thousands of workers who used government loans, the payment deferral scheme or were furloughed will need to be addressed by the banks, said the panellists.

By 2022, products like offset mortgages should be revamped to allow borrowers to use them as complete financial tool, rather just a home loan. And new criteria around different working patterns, or credit issues suffered by first-time buyers or self-employed borrowers during the pandemic should be adopted by mainstream banks, not just specialist lenders.

Speaking on Mortgage Solutions Television, in association with Kensington Mortgages, Adrian Scott, group mortgage services director for Connells Group, said he was keen to see the high street banks drop a purely “data driven” approach.

He wants the banks to see the opportunity in helping first-time buyers who may have had some financial difficulty in the during the pandemic but were now in a position to be good customers.

“The answer could be in the specialist lending market which the likes of Kensington are very capable and able to underwrite,” he said. “But I think it is also the [responsibility of] mainstream lenders, dealing with a data driven approach. I think it becomes quite challenging for them because in many respects the background data [used to assess cases] will be very different than it has been.

“…there is a great opportunity for lenders to push into that gap and deal with these great customers who won’t have the sort of profile they would historically have had.”

Scott was joined by Craig McKinlay, new business director, Kensington Mortgages, Martin Reynolds, chief executive, Simply Biz Mortgages, and Sally Laker, managing director, Mortgage Intelligence.



Laker said self-employed underwriting had changed from looking at past history to scrutinising current bank statements and wanting to know about the firm’s future prospects, if they furloughed staff, how they coped with Covid and what sector they traded in.

Laker said: “All of those questions are all new questions. I think it will make underwriters look at how they can structure self-employed mortgages in a way that both the customer and broker know and understand what requirements are needed to get that mortgage through.”