Over three-quarters of self-employed people are concerned about their prospects of getting a mortgage, according to the latest Pepper Money Specialist Lending Study.

The specialist mortgage lender commissioned YouGov to conduct research amongst more than 6,000 adults and found 77% say that being self-employed makes it more difficult to be approved for a mortgage.

One challenge for the self-employed is that many mortgage lenders base the affordability of a mortgage on the average of the last three year’s profit. However, with Covid impacting most businesses in 2020, many businesses have made stronger profits in their last year than the previous two years.

The Pepper Money Study found 20% of self-employed people say that their business made over 10% more profit in the last year than the previous two years.

Paul Adams, sales director at Pepper Money, said: “The self-employed play a vital role in the country’s economy and the respondents to the survey are largely correct in that it can sometimes be more difficult to secure a mortgage as a self-employed person. But it doesn’t have to be that way.

“There are many lenders, like Pepper Money, that specialise in lending to self-employed customers, with criteria and processes that are designed to meet the particular circumstances of self-employment, including the ability to lend on the most recent year’s figures, which can make an important difference in helping the self-employed achieve the loan size they deserve.

“It’s not just the self-employed who can benefit from this specialist approach. Our research found a quarter (25%) of all workers earn variable income, either from overtime or bonuses and the ability to consider this additional income is often an important factor in helping them to achieve the mortgage they deserve.”