Some might say the UK labour market has lost some of its confidence.

Unemployment is rising, job moves have slowed, and many employers are holding back on hiring while they wait to see whether the Government can deliver on its promised economic growth.

The figures reveal this reality. Last year between September and November there were 1.84 million unemployed people in the UK, up 280,000 on the year previously, with the unemployment rate rising to 5.1% from 4.4%¹.

Pay is still rising, but at a slower pace. Average earnings growth is easing, particularly in the private sector, and real-terms growth is modest once inflation is taken into account².

At the same time, economic growth forecasts remain cautious. The Office for Budget Responsibility (OBR) expects GDP growth of 1.4% in 2026, while the Treasury’s survey of independent forecasters is lower at 1.1%³.

Against this backdrop, it’s perhaps not surprising that many workers feel less secure. Coupled with the fact that, for a growing number of households, income does not arrive in neat monthly packets.

It is this reality that is increasingly becoming the mortgage broker’s problem to solve.

UNEVEN INCOME IS COMMON, NOT NICHE

Irregular income of course is not just limited to a small corner of the workforce; it affects an increasingly large number of people across creative, professional, and seasonal roles.

Freelance writers, designers, photographers, and consultants are often paid per project. They may invoice large sums, but payment can be weeks or months after the work is done.

In construction and property, builders and tradespeople are paid at stages of a job, while developers can face long gaps between costs and final sale of the property. Cash flow can look uneven, even when profits are strong over time. Sales roles show a similar pattern and commission-led staff like estate agents or recruitment consultants may see income spike when deals complete, followed by quieter periods with lower pay.

Overall, in practice, these workers may earn enough to support a mortgage, but the challenge is how that income is assessed by mainstream lenders.

WHERE STANDARD LENDING FALLS SHORT

Standard, high-street mortgage processes are built for steady salaries. They rely on averages and fixed rules that struggle to reflect how many people are actually paid.

For first-time buyers, in particular, this can be a real problem. Some stretch affordability by taking on second or third jobs, or by relying on regular overtime and bonuses. Others, including well-established creatives, are waiting on project payments that do not fit tidy timelines.

When these cases are fed into rigid application systems, the result is often a decline. Not because the borrower can’t afford the loan, but because the income does not fit the model.

WHY INCOME DETAIL MAKES A DIFFERENCE

Lenders, like ourselves, who take a more detailed approach to income are able to accommodate these real-world incomes. This can include commission, bonuses, overtime, benefits, or profits from a business, assessed with context rather than blanket limits.

For lower-income households, this detail can be the difference between buying and missing out, especially at higher LTV levels. For higher earners, it can mean recognising the true strength of income that arrives in uneven bursts rather than monthly amounts.

The ability to assess income properly also matters for existing homeowners. UK Finance expects 1.8 million fixed-rate mortgages to end in 2026, alongside a 10% rise in external remortgaging⁴. These borrowers may face payment shocks this year as they refinance onto higher rates. A fuller view of income could help smooth that transition.

THE YEAR AHEAD FOR BROKERS

In January, we increased our LTV to 95% on our income flex products in a bid to help more borrowers with varying income streams or irregular salary payments hit their homeownership goals.

The fact is, brokers will need every option available to help clients with uneven pay, whether they are first-time buyers trying to get on the ladder or homeowners resetting their borrowing. 

Lenders that take time to understand how income is earned, rather than how it appears on a payslip, will play an important role in helping those cases reach the right outcome.

Laura Sneddon is head of sales and distribution at Hinckley & Rugby for Intermediaries

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