A survey by Afin Bank found that over a quarter of self-employed workers believe they have been turned down for a mortgage due to factors linked to their employment status.
More than a third believe their self-employed status had stopped them from buying a new home, and almost a quarter said their unpredictable earnings or fluctuating income had been a barrier to getting a mortgage.
Only 13% said they had insufficient proof of earnings or not enough years of accounts that had stopped them getting a mortgage, and the same proportion thought an insufficient credit history was a factor in their mortgageability.
Approximately 9% of respondents believe they had been turned down for a mortgage as the lender may not accept multiple income streams.
Almost a third of those surveyed said that while the mortgage process was difficult, they have eventually managed to secure one.
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More than eight out of 10 said they felt like self-employed workers were an “under-served community” when it comes to banking, mortgages and financial services.
Afin Bank said the proportion of self-employed workers was growing, with 4.4 million recorded at the end of Q2 this year.
James Briggs, intermediaries sales director at Afin Bank, said: “While a lot of lenders claim to serve the self-employed, our research shows that support is patchy and difficult, to the point that a majority would consider returning to a salary-paying role to make it easier to get a mortgage.
“The definition of self-employment is evolving because of changes in working practices since Covid or because of uncertainty in the employment market. We have seen an increase in people on contracts, freelancing or with portfolio jobs managing multiple income streams.
“We want to support as many self-employed people as possible, so we don’t use a tick-box approach and instead work to understand their circumstances to provide them with suitable mortgages.”
