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More adverse credit homebuyers seeking advice

57% of homebuyers with adverse credit would seek the advice of a broker to find the right mortgage, up from 40% six months ago, according to recent research carried out by YouGov on behalf of Pepper Money.

The study found that 57% of all adults who have experienced adverse credit in the last three years and are intending to purchase a property in the next 12 months would go to a mortgage broker to source a mortgage for them.

When it comes to finding a broker, 54% say they would carry out online research, which is up from 49% in the last report.

34% say they have an existing relationship with a mortgage broker, down from 44% last autumn and 48% would ask friends and family for recommendations, which is up from 36%.

Paul Adams (pictured), sales director at Pepper Money, said: “It is very encouraging that a growing number of people with specialist mortgage requirements understand the benefits of seeking professional advice, and we have seen a real surge in awareness over the last six months.

“We have also seen an increase in the number of people who would go online to find a broker and also a decrease in the number of people who say they have an existing relationship with a broker. This could possibly be due to an increase in the number of first-time buyers. Whatever the reason, it is clear that there is significant opportunity for brokers with a strong online presence to take on new clients.

“There are, however, still many potential homebuyers with adverse credit, who would go directly to a high street lender or seek advice from friends and family and these avenues may lead to them thinking that they have no opportunities to secure a mortgage. So, we still have plenty of work to do to raise awareness and understanding amongst customers, and potential clients for brokers.”

By Kevin Rose

Source: Best Advice

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Brokers unsatisfied with how lenders handle adverse credit

Brokers are least satisfied with how lenders handle adverse credit and commercial buy-to-let cases, Smart Money People has found.

Following broker feedback in its Mortgage Lender Benchmark, broker satisfaction with mortgage lenders’ handling of adverse credit cases is 74.6%, rising to 77.1% for commercial buy-to-let cases.

The average satisfaction across all mortgage case types is 81.1%.

Nate Harwood, co-founder of Smart Money People, said: “Brokers appreciate that adverse credit and commercial buy-to-let cases are trickier and more specialist in nature.

“That said, they’re not prepared to cut lenders operating in these areas any slack.

“And with some 1.3 million people with adverse credit expected to be looking for a mortgage in the next year, how lenders handle adverse credit cases in particular, really does matter.”

When it comes to adverse credit cases, brokers are particularly dissatisfied with the speed to process applications through to offer.

The average adverse credit lender received a 59% rating around speed, 15% lower than the average across all cases (74%).

Broker satisfaction with the ease of determining the maximum loan amount is another key weak spot, and stands at 76% which is 7% lower than the average (83%).

Meanwhile, the ease of determining product eligibility proved to be the key point for brokers leaving feedback for commercial buy-to-let lenders.

The average commercial buy-to-let lender satisfaction rating is 77%, some 4% lower than the average seen across all cases (81%) and 2% lower than residential buy-to-let cases.

The research has also identified the highest rated lenders for adverse credit and commercial buy-to-let cases.

Brokers highlighted the best adverse credit lenders as Bluestone, Pepper Money, Precise Mortgages, The Mortgage Lender and Aldermore.

Furthermore, the top commercial buy-to-let lenders according to brokers are BM Solutions, Leeds Building Society, The Mortgage Works, Kent Reliance and Precise Mortgages.

By Michael Lloyd

Source: Mortgage Introducer