TML: 85% of self-employed say income has not returned to pre-COVID levels
An estimated 85% of self-employed people in the UK say their income has not yet returned to pre-pandemic levels, according to research conducted by The Mortgage Lender.
The survey revealed 28% of self-employed people have seen their income reduced by more than half over the past year because of the pandemic and 16% said they had suffered income losses of between a quarter and 50%.
Consequently, 51% believe it is now more difficult for a self-employed borrower to get a mortgage and a further 53% claim that their self-employed status has deterred them from even applying for one.
Furthermore, 18% of The Mortgage Lender’s self-employed panel had not experienced any change to their income and 14% said it had increased.
Steve Griffiths, sales and product director at The Mortgage Lender, said: “When we launched our new residential range earlier in the year we did so with the self-employed, complex income borrowers and credit impairment front of mind, because these are the people who have been most affected by the pandemic.
“Even before the pandemic self-employed people felt let down by the mortgage market. In 2018, as part of a special report called ‘The Self-Employed Economy’ we found that 1m (21%) self-employed people had reconsidered their employment situation because of the uncertainty of securing a mortgage.
“Today, the statistics show even more pessimism, with over half believing their chances of being given a mortgage are so slim they don’t even think it’s worth applying.
“Now more than ever specialist lenders need to have criteria that caters for a wide range of customer circumstances and recognise that the last 12 months has been financially difficult for many people.”