Nearly four in five (83%) of brokers say that lenders are not adapting fast enough to meet the changing needs of today’s borrowers, a figure that has risen from 52% six months ago. Meanwhile the number of those saying that lenders need to support a broader range of financial circumstances with revised products and criteria has also risen, up to 86% from 61% previously.
The research, from Nottingham Building Society, also suggests that one in three brokers want to see greater flexibility in affordability requirements introduced, with 32% saying that such reform would be the single most effective lever for improving mortgage outcomes in the current market.
The findings come as the Financial Conduct Authority continues its review of mortgage rules.
Breaking the mould
Brokers say that those borrowers whose finances and lives do not fit traditional moulds are being let down the most. These include borrowers returning from career breaks (32%), followed by those with multiple income streams (31%), applicants with irregular or seasonal income (29%) and borrowers relying on bonuses, commission or overtime (29%).
Self-employed borrowers are also not being adequately catered for, with more than a quarter (28%) of brokers citing them as a particularly disadvantaged cohort. Latest government statistics suggest there are nearly 4.5 million self-employed people in the UK.
Non-traditional income profiles
Those with non‑traditional or blended income profiles are most likely to be disadvantaged by current affordability models, particularly at early assessment stages. Meanwhile, brokers said that applications involving multiple income streams, variable earnings, or career breaks were most likely to stall or fail during automated checks or initial affordability assessments. This is despite the fact that often borrowers may be well‑placed to sustain repayments over the longer term.
The need for greater relevance
Aaron Shinwell, chief lending officer at Nottingham Building Society, said: “What brokers are telling us feels very real in the current climate. Households are juggling higher living costs, changing work patterns, and more uncertainty, yet too many aren’t able to pass standard affordability assessments.
He said products must change to better suit today’s needs. “Rigour in affordability matters, but so does relevance. Particularly in an environment where money is tight for many. As the FCA looks again at whether the rules are fit for modern borrowing, this is a moment for lenders to be more pragmatic and human in how we assess affordability.
“That means recognising diverse income patterns, life events, and career paths — while still lending responsibly. If we get that balance right, we can support more sustainable homeownership whilst lending responsibly.”
