A study from The Mortgage Lender (TML) revealed sole traders were less likely than any other kind of self-employed worker to attempt to apply for a mortgage.
Some 26% said this was because they thought they would not be approved for one, while 17% had heard the mortgage application process was more challenging for self-employed people.
A tenth said the mortgage process was “too daunting”, 24% said fluctuating income meant they had to delay applying for a mortgage, and 18% said they were worried their employment status might disadvantage them.
Employment status was the main worry, as 38% of people said this had a negative impact on their plans to buy a property and 15% had thought about abandoning property plans altogether.
Not all respondents felt this way, as 68% said they would be able to achieve their property goals in the next five years.
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Sara Palmer, distribution director at TML, said: “While the hurdles to homeownership can be especially high for sole traders, it’s encouraging to see that so many of this cohort are still keen to pursue their homeownership plans.
“This is a testament to their resilience, and as lenders, we must recognise this ambition and ensure we’re aligning our product offerings to match. Sole traders are responsible for their own businesses, and contribute a significant amount to our economy, so should not be penalised when it comes to how their income is generated. We regularly review our criteria to best help people achieve their property ownership goals.”
