Steve Seal is chief executive of Bluestone Mortgages

A sea of financial troubles

Since the final quarter of last year, we’ve witnessed a myriad of economic obstacles which have affected consumers’ personal finances for the worse.

We’ve witnessed the rising costs of everyday items, energy bills skyrocketing, and the Bank of England raising interest rates to combat inflationary pressures, yet people’s wages aren’t keeping up with the spike in costs of living.

In the face of rising prices and interest rates, it’s therefore no surprise that the average consumer has felt, and will continue to feel, the squeeze on their personal finances this year.

In fact, our own research found that 67% of those traditionally underserved by the mainstream mortgage market, say the rising costs of everyday items are their main financial concern this year.

At the same time, we are seeing a growing number of customers struggling to keep up with regular payments. The number of county court judgments against consumers in England and Wales was 848,124, an increase of 36% compared to 2020, and the number of judgments satisfied by consumers fell compared to 2020, reflecting the strain the pandemic has had on consumer finances.

As customers with complex credit are set to become the ‘new norm’ and the government continues to dial back support for customers, it is our responsibility as an industry to step up and support this growing cohort of customers who may be facing financial challenges of some kind.

This is where the specialist lending market has a vital role to play, and its growth will only accelerate given the changing credit profiles of customers who are unable to secure a mortgage with a mainstream lender. This represents a huge opportunity for brokers, who are going to be approached by more people looking for a helping hand.

The duty of brokers and specialist lenders

At a time when a growing number of high-street lenders are tightening their lending criteria, and the cost of living is increasing, getting onto or up the property ladder may seem challenging.

And, this is why brokers – now more than ever- have a vital role to play in demonstrating to existing and would-be borrowers that there are multiple routes to homeownership and solutions available to meet their needs, whether that be locking in a fixed rate or remortgaging.

However, the moral responsibility of directing customers to the right options doesn’t and shouldn’t only rest on brokers. The industry as a whole, too, has the obligation to support borrowers who don’t fit the criteria of high-street banks by signposting them to the best options available to suit their individual borrowing needs.

Challenges remain, but hope is not lost

Looking ahead, many of the challenges consumers face today will prevail. However, it’s not all doom and gloom. The specialist lending market will continue to have a significant role to play in supporting people who do not fit the ‘vanilla’ criteria because of their financial situation.

It’s the duty of our industry and at the core of what we do to remind these disenfranchised customers that there’s still hope for them to climb onto or up the property ladder and reach their homeownership dreams.

Whether a borrower has complex credit, a blip in their credit history, or is self-employed, there are always solutions out there for them, and it’s our job to make them aware of their options.