More than one in four aspiring homebuyers have been denied a mortgage, with income levels cited as the leading reason, according to new research from LendInvest Mortgages.
The study, conducted by Opinium Research among 1,000 adults planning to buy or remortgage within the next five years, found that 26% of respondents had experienced a mortgage rejection. Of those, more than one-fifth (22%) said their income was the reason for being turned down, while 18% blamed their credit history and 16% pointed to affordability or age.
Among those rejected, 40% had applied directly to a high street lender, with an equal proportion going through a mortgage intermediary. A further quarter applied directly to a non–high street lender.
LendInvest said the findings underscore how income and credit factors continue to prevent would-be buyers from accessing home finance, despite the growing range of specialist options available through brokers.
The research also highlighted the emotional toll of rejection. Many respondents described feeling stressed, embarrassed, frustrated or ashamed after being denied, though 14% said the experience left them feeling more determined and hopeful.
STATUS ISSUES
More than a third of those surveyed (35%) said they had been discouraged from applying for a mortgage by high street lenders because of their income or employment status. That figure rose to 40% among 18– to 34–year–olds, suggesting younger buyers are particularly affected.
Paula Mercer, sales director at LendInvest, said: “This data solidifies that for many, factors like income levels and credit histories are the biggest blockers to purchasing or remortgaging a home.
“The impact of getting denied a mortgage is significant, leaving many feeling stressed, embarrassed, frustrated and even ashamed.
“With 40% of rejected mortgage applications coming directly from traditional lenders, this research highlights the crucial role of mortgage brokers who champion specialist lenders, who often can offer solutions beyond the scope of high street banks.
“At LendInvest, we realise that there is no ‘one-size-fits-all’ approach to mortgages, and we take pride in our lending criteria that can support those with complex income streams, the self-employed and those with the occasional blip on their credit history.”
The fintech lender, listed on the London Stock Exchange, said the findings demonstrate the continued need for innovation and flexibility in mortgage underwriting as more borrowers fall outside mainstream criteria.
