Mortgage Soup fires the questions at Steve Griffiths, commercial director for retail mortgages at Shawbrook.

Mortgage Soup (MS): Shawbrook’s latest Home-A-Loan report highlights a market where demand remains high but access to finance is still uneven. How would you summarise the current state of mortgage accessibility across the UK?

Steve Griffiths (SG): Getting on the property ladder is a feat in and of itself, and this can be made even harder for borrowers considered non-traditional – due to income streams, employment type, or past credit history.

These borrowers have grown accustomed to a constant stream of bad news about how difficult it is to secure finance, which makes aspirations of homeownership feel even more out of reach.

Something which exacerbates this perception are average deposit requirements, which can be misleading and often discourage potential homeowners. To improve the situation, the industry needs to ensure customers fully understand the big changes that have occurred over the last 12 months that will help more customers meet affordability challenges.

Crucially, advisers need to clearly demonstrate where specialist lending can help with affordability and address issues that might fall outside of mainstream criteria, like complex income, self-employment or credit history.

MS: Three in 10 adults have attempted to get a mortgage, and a further 13% have applied multiple times. What does that tell us about borrower persistence – and the structural hurdles they’re encountering?

SG: This data highlights an undeniable level of borrower persistence, where the aspiration of homeownership is so strong that people are willing to navigate a challenging system repeatedly.

However, these repeated attempts also reveal significant structural hurdles. While affordability remains a concern, especially as wage growth isn’t keeping pace with house prices, the key issue is that there is no longer a ‘cookie-cutter’ borrower.

While applicant profiles have diversified (e.g. freelancers, multiple income streams), many high-street lenders are yet to fully adapt. This lack of flexibility forces people to apply multiple times without the necessary specialist support they need to get an approval.

MS: Approval rates drop sharply for certain groups, particularly first-time buyers and those with impaired credit. From your perspective, are traditional underwriting models still fit for purpose?

SG: From a systemic perspective, no, traditional underwriting models are no longer fit for purpose for a significant portion of the market. The mainstream lending model prioritises a high volume of approvals via light-touch reviews and with low-cost underwriting.

While this works for those who fit the ‘ideal’ borrower profile, it does not support customers with more complex needs, especially at high LTVs typically needed by first-time buyers, or by those with impaired credit.

This is precisely why specialist lending exists. It provides a bridge to meet those customer needs by spending more time understanding the application in full, rather than an automated snapshot that leads to a quick, but very binary lending decision.

MS: The report shows that 35% of declined applicants were rejected because of poor credit scores and more than a quarter due to volatile income. Do affordability frameworks need modernising to reflect how people actually earn today?

SG: Affordability frameworks within specialist lending are definitely more aligned to reflect the modern borrower. The combination of a higher interest rate environment and a higher cost of living means that more customers need lenders to consider more income than previously may have been required.

By taking a clear and consistent approach to variable income such as overtime, commissions or bonuses, and second jobs, is key to giving customers confidence to pursue and achieve their goals.

MS: How much of the current rejection picture is being driven by cost-of-living pressures versus the limitations of lender risk appetite?

SG: Both cost-of-living pressures and lender risk appetite are key drivers of the current rejection picture. The rise of high inflation above wage growth – combined with house price inflation and the higher interest rate environment that we have seen in recent years has proved a significant barrier, leading to immediate affordability pressures.

However, the good news is that recent changes to affordability regulation alongside reducing interest rates have been key in enabling lenders to create a more positive outcome for customers.

This is particularly relevant in the specialist market, where providing product choice is paramount. This allows customers to find an option that truly suits their needs, such as opting for a shorter fixed-rate period rather than being tied into a long-term commitment.

This shorter period allows customers the necessary time to demonstrate more established income or an improved credit profile, serving as a stepping stone to transition into a more mainstream mortgage product.

MS: Self-employed workers now account for 4.4 million people in the UK, yet they remain disproportionately excluded from mainstream mortgage access. Why does this gap persist?

SG: The gap persists primarily because high-street lending criteria is fundamentally skewed towards the traditional borrower – someone with a regular, singular income and a clear credit history.

For the self-employed applicant, whose income streams and company structures are inherently more complex, this automated or ‘cookie-cutter’ approach fails to accurately assess their risk.

The key to closing this gap is understanding the market. This is where experienced specialist underwriters play a vital role, taking the time to make accurate decisions based on a deep understanding of company structures, accounts, and cash flow.

This thorough review ensures self-employed applications are carefully and accurately considered for approval, rather than being summarily rejected due to inflexible mainstream criteria.

MS: Almost eight out of 10 (79%) of self-employed respondents in your research said they’ve never missed a due payment – significantly higher than among full-time employees. What does that say about how lenders assess risk?

SG: This data, which shows almost eight out of ten self-employed respondents have never missed a due payment, suggests that many mainstream lenders may be miscalculating the true risk associated with this sector.

The self-employed have a distinct advantage when faced with expenditure challenges – they are in charge of their own income destiny, having the potential to increase their earnings when needed. For someone with a traditional job, working more or increasing their margins to drive income is out of their control.

We recognise this and are working hard to support more self-employed customers by giving brokers the criteria that they need, backed by the necessary support from BDMs and underwriters.

MS: The data also shows real progress, with self-employed mortgage rejection rates falling from 45% last year to 24%. What’s driving that improvement, and how is Shawbrook adapting its criteria to support further gains?

SG: It is excellent to see that progression. The fall in rejection rates is likely driven by a combination of factors: a growing borrower awareness and preparedness, with individuals researching and planning earlier to achieve success from the first application. But there is certainly more to be done on the lender side to sustain this trend.

Shawbrook is adapting its criteria to support further gains by focusing on depth of underwriting:

• Market-Leading affordability: Through our TML brand, we already offer market-leading affordability by utilising salary and share of profit before tax as allowable income.
• Product choice: We have reduced our stress rates to give customers more choice in shorter fixed rate periods, which is vital for new businesses who do not meet mainstream criteria due to insufficient trading periods.
• Wider contractor support: We are actively supporting the wider contractor market, including day-rate professional contractors with shorter track records in Umbrella or Ltd company structures.
• CIS contractors: We provide specific criteria to help CIS contractors in the construction industry, who often face barriers. We can support these customers with a track record of just three months.

MS: Just over one in five (22%) of those surveyed used a broker, yet 97% of those who did were highly satisfied with the advice and support they received. Why do you think broker usage remains so low, particularly among complex borrowers?

SG: Lack of awareness is a leading cause, and lenders and brokers need to work together to ensure customers are aware of what is possible in the current market – while also giving customers the confidence that brokers have the solutions to meet their needs.

There is also a misconception that these cases can be more time-consuming than traditional applications. In reality, the advancement of technology such as automated income verification and AVMs has drastically reduced touchpoints.

We regularly see cases where we are able to use external data sources rather than paperwork to satisfy our underwriting requirements, sometimes meaning the broker has to provide no supporting documents such as numerous payslips and bank statements.

MS: More than a third of applicants who were declined weren’t referred to a specialist lender – and that rises to over half among self-employed borrowers. How can the industry get better at signposting?

SG: The industry must get better at signposting by shifting advice from a transactional event to an ongoing strategy.

Great advice is invaluable not just at the point of sale, but throughout the process, giving customers a realistic idea of when they might be able to achieve their goals – even if that means waiting a little longer to build a deposit or improve their credit profile.

Specialist lenders offer the crucial flexibility needed for this long-term view. For instance, a key area where we excel is with our Bluestone brand. We base our decision on where a customer’s credit issue will stand at the point of completion, rather than the date of application.

This approach acknowledges that the house purchase process can take time and this can make a huge difference, allowing us to help many customers achieve a positive outcome sooner than they otherwise might.

MS: The report suggests that awareness of specialist lenders remains low, with only one in four consumers understanding who they are or how to access them. What can lenders and brokers do collectively to raise visibility and trust in this space?

SG: Social media has been a great way to share real stories – spotlighting people who got on the property ladder, the process, and what the journey was really like.

Similarly, targeting other professionals is important too. In the home-buying process, accountants and solicitors are often the first port of call, and they need to be aware of specialist lenders as well – whether that’s as a solution, endorsement, or just extra knowledge.

Borrowers need to know there are routes to homeownership outside of just high-street lenders, and focusing on the positives to challenge the negative narrative is another push towards establishing trust in the space.

MS: Consumer confidence has taken a hit, with only 20% of adults saying they feel completely confident about securing a mortgage. What can lenders do to rebuild confidence, especially among those with historic credit issues?

SG: To rebuild consumer confidence, especially for those with a history of credit issues, a collective effort between lenders and our brokers is essential. As the sector is intermediary-led, lenders must ensure brokers receive the right support and education to meet their customers’ needs confidently.

At Shawbrook, we support this by giving brokers access to well-informed and experienced business development teams. For example, we have a team of over 40 people whose prime focus is assisting brokers with customers who have been rejected by high street banks.

By working together and raising awareness about specialist lending, we can ensure that consumers understand that a Plan B, or alternative route, exists – and that historic credit issues or complexity of income do not have to be a permanent barrier to securing a mortgage.

MS: Around a third of prospective buyers are actively working to repair their credit or taking on additional work to strengthen their mortgage eligibility. How should lenders balance automated credit scoring with more nuanced, human-led assessments?

SG: Good specialist lending always has a human at the heart of more complex decisions. Advances in technology provide efficiencies that give our underwriters more time to focus on the areas where a human approach is needed.

At Shawbrook, we believe letting technology do what it does best allows our people to do what they do best.