Whatever lies ahead of us in 2025, it will certainly be a year full of opportunity for brokers to make a real difference to those customers who just miss out on a mortgage from a high street lender.
The economic challenges of recent years have continued to develop an environment of increased complexity when it comes to customer circumstances, with rising levels of unsecured borrowing, increased incidents of missed payments and more people working more than one job to meet their financial commitments.
As house prices remain high relative to wages, and the average UK homebuyer needs 10.6 times the average annual salary to afford a property, every source of income and every piece of financial context matters. Our recent Pepper Money Specialist Lending Study reported that 14% of adults – or 7.34 million people – earn income from more than one job as a result of the cost-of-living crisis.
On top of this, 35% of people earn a variable income, including payments such as bonuses, overtime, or commissions. For these customers, high street lenders often don’t fully consider these diverse income sources in their affordability calculations, leaving them unable to secure the borrowing they need despite having the financial means to afford repayments.
At the same time, there is a growing number of potential borrowers who may have recently missed payments on their credit record, often due to the financial pressures of the cost-of-living crisis. These individuals may have substantial incomes and financial stability today but find themselves excluded by traditional lenders that cannot accommodate the nuances of their credit history.
This is where brokers can seize the opportunity to help. By working with specialist lenders like Pepper Money, brokers can support customers who just miss out on a high street mortgage – whether it’s due to their reliance on multiple or variable income sources or a recent blemish on their credit record. Specialist lenders are equipped to take a more hands-on, tailored approach, thoroughly assessing these factors to provide mortgage solutions that fit the customer’s individual circumstances.
Looking ahead, specialist lenders will play an increasingly important part of a broker’s toolbox in ensuring that those who narrowly miss out on high street criteria are not left behind.
