An estimated 30% of self-employed people believe changes to their finances during the pandemic will negatively impact their ability to get a mortgage in the future, according to The Mortgage Lender (TML).
More than half (55%) of existing mortgage holders feared they would not be able to secure a loan for the amount they currently owe if their borrowing was based on self-employed earnings over the past year.
These fears mean that 39% of self-employed people in the UK have been reconsidering their employment status, while 43% have applied for an employed role over the past year.
Those living in the South East were the least hopeful about their chances of securing a mortgage, with 60% believing it is now more difficult than ever for self-employed people.
This belief was echoed by 55% of self-employed people in the North West, 52% in Wales and the West Midlands, and 51% in Scotland and East Anglia.
Steve Griffiths, sales and product director at The Mortgage Lender, said: “Our research has exposed a feeling among self-employed people that the mortgage market has closed its doors to them.
“47% said they have been deterred from even applying for a mortgage because of their self-employed status. And 43% of those aged between 18 to 34, and 36% of those aged 35 to 44 believe their chances of being given a mortgage in the future have been scuppered because of the financial impact of the pandemic.
“With an estimated five million self-employed people in the UK before the pandemic, it doesn’t make for lenders to turn their backs on them.
“As a specialist lending sector, we have to adapt and provide products and criteria that cater for borrowers whose circumstances have been challenging over the last year.
“Our real life lending products do just that, catering for people who are different, whether that’s through self-employment, those with complex incomes, or indeed those who have been furloughed and are facing an uncertain future.”