Self-employment leaves 150,000 unable to move home in Yorkshire

More than 249,000 (74 per cent) self-employed people in Yorkshire and the Humber feel discriminated against by mortgage lenders and nearly 150,000 (44 per cent) say they would live in another property if they were paid the same as they are now but employed rather than self-employed.

The shock findings are from research among people who are sole traders, contractors, or running a business with up to nine employees, and suggest widespread dissatisfaction with the way self-employed people are treated when they apply for a mortgage.

The figures, which are part of a special report – The self-employed economy; an opportunity for brokers and lenders – by The Mortgage Lender show 120,000 (35 per cent) of self-employed people in Yorkshire and the Humber had reconsidered their employment situation because of the uncertainty of securing a mortgage.

Nearly 240,000 (71 per cent) believe mortgage lenders have a responsibility to provide a better level of support to self-employed, contract workers and business owners and nearly 120,000 (35 per cent) think they would be refused a mortgage if they applied for one simply because they are self-employed.

Of those in Yorkshire and the Humber who have applied for a mortgage 38 per cent found it difficult to provide the information required by the lender to assess their application.

There are 339,000 self-employed individuals in Yorkshire and the Humber, accounting for 13.2 per cent of the working population, according to the Office for National Statistics.

The Mortgage Lender deputy chief executive Peter Beaumont said: “Self-employed people in Yorkshire and the Humber are being let down by lenders, nearly 150,000 would like to move house but feel they can’t because they’re self-employed. That’s around 54,000 people living in rented accommodation and 96,000 who are effectively mortgage prisoners.

“As a sector we’ve quite happily lent to married employed people when statistics show at least half of those couples are going to split up.

“Self-employed people in the region are creating employment opportunities and form the backbone of our economy at a time when many large employers are finding it difficult to sustain their business models and levels of employment. It’s important lenders recognise this reality and support entrepreneurs to live in the home they can afford.

“It’s something that we at The Mortgage Lender have recognised. People’s financial circumstances are constantly changing. It’s why we believe in real life lending, we understand that life doesn’t move in a straight line.”

The full report – The self-employed economy; an opportunity for brokers and lenders – also reveals a 53 per cent rise in self-employment since 2000 and that 60 per cent of the growth in self-employment since 2008/09 has been in high skilled, higher paying sectors.

Advertising, public administration and banking have seen the largest growth in self-employment while London (18.6 per cent), the South East (16.1 per cent) and the South West (17 per cent) boast the highest percentages of self-employed people.

To download the full report visit https://www.themortgagelender.com/self-employed-mortgage-market/

The Mortgage Lender is an intermediary-only mortgage lender. It caters for a wide range of borrowers including employed, self-employed, those with impaired credit, lending into retirement and buy to let investors.

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