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Self-employed giving up on home ownership dream 

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Written by: John Fitzsimons
26/09/2019
More than a million people who work for themselves do not believe they will ever be able to buy a home, a study from Kensington Mortgages has revealed.

The research found that more than two-thirds of self-employed people feel their employment status puts them at a disadvantage when it comes to getting a mortgage, while almost half said the likely difficulty in getting a home loan had put them off being self-employed.

More than one in four of those polled who are currently looking for a mortgage said they had experienced so many issues that they were now actively considering finding a steady job instead.

Kensington pointed to its affordability tracker which it suggested showed that self-employed borrowers were actually a safer bet than first-time buyers, typically borrowing 28 per cent less than the maximum sum they could get from a lender.

This is in contrast to first-time buyers, who borrow 19 per cent less than the maximum on average.

Mark Arnold, chief executive of Kensington Mortgages, said self-employed borrowers had historically struggled with the various barriers to getting a mortgage, as well as being viewed as more risky by lenders.

He continued: “As a group, the self-employed tend to be more cautious, better savers and a smaller risk to a mortgage lender than being a fully employed person. We’ve found that your average self-employed individual has six months’ worth of savings, relative to full time employees, who tend to only have one month’s savings.”

“It shouldn’t be harder to get a self-employed mortgage, but you do need a good broker to point you in the right direction and talk you through the options.”

 

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