Rise in customers with adverse credit seeking professional advice

More than half of customers with adverse credit looking to buy a property say they would speak to a broker to help them get a new mortgage, new research from Pepper Money has indicated.

The findings come as CACI reported remortgage activity could significantly climb to almost £40bn in January, overtaking the biggest month of October 2021, with remortgage maturities at £38.9bn.

Whether customers are seeking to buy or remortgage, Pepper Money suggested that the role of an adviser will be “increasingly important” this month. The firm’s latest Adverse Credit Study found that 54% of people with adverse credit – who want to buy a property in the next 12 months – say they would speak to a broker to help them get a new mortgage. This figure is up from 44% when the study was last conducted in Spring 2021.

The findings were based on a representative sample of 4,192 UK adults of which 492 had experienced adverse credit, and also suggested that 41% of those with adverse credit say they would feel uncomfortable talking to a professional financial adviser about their finances. Therefore, work remains to help customers with credit blips become more comfortable in seeking professional advice.

Pepper Money sales director, Paul Adams, commented: “Professional advice is the best option for any customer who has experienced blips on their credit record. Advice not only ensures they are presented with the best options for their circumstances, but it also opens up the option of lenders that are not available direct to customers.

“It’s great news that more than half of customers with adverse credit would speak to a broker to help them get a mortgage to buy a new property. However, at the same time, more than four in 10 still say that they would feel uncomfortable talking to a professional financial adviser about their finances.

“It’s important then that we work harder to break the stigma around missed credit payments and do more to promote the benefits of speaking to a mortgage adviser.”

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