Brokers say lenders are not adapting quickly enough to evolving borrower needs

83% of mortgage brokers say lenders have not moved quickly enough to keep pace with borrowers’ evolving needs, a sharp increase from 52% just six months ago, according to new research from Nottingham Building Society.

With the FCA currently reviewing mortgage rules to boost wider access, the findings reflect growing broker concerns that not enough of the mortgage market is evolving its approach to reflect how people across the UK earn and manage money today.

The research points to a growing disconnect between traditional lending models and the reality of modern working and living patterns, with lenders’ inflexible approach to mortgage lending nearly doubling as a key factor in the past six months, from 16% to 30%.

Brokers say the strain is being felt most by borrowers whose finances and lives do not fit 'traditional moulds'. When asked which borrower groups are most likely to be disadvantaged by mainstream mortgage affordability assessments, the most cited group is people returning from career breaks (32%), closely followed by borrowers with multiple income streams (31%), applicants with irregular or seasonal income (29%) and those relying on bonuses, commission or overtime (29%).

More than a quarter (28%) of brokers also call out self-employed borrowers as a particularly disadvantaged cohort of borrowers.

New product innovation needed

When asked what can be done to address these concerns, the vast majority of brokers (86%) say it is important for lenders to develop and provide products and criteria that support a broader range of financial circumstances. This is up from 61% six months ago, reflecting the appetite for products and criteria to meet more diverse borrower needs.

Nearly one in three brokers (32%) also said that placing greater emphasis on affordability reform would be the single most effective lever for improving mortgage outcomes in the current market, overtaking other priorities such as speed, pricing or process.

Looking beyond the headline call for affordability reform, broker feedback suggests the challenge is less about loosening standards and more about how affordability is assessed in practice.

The research shows that borrowers with non traditional or blended income profiles are most likely to be disadvantaged by current affordability models, particularly at early assessment stages. Brokers highlight that applications involving multiple income streams, variable earnings, or career breaks are more likely to stall or fail during automated checks or initial affordability assessments, even where borrowers may be well placed to sustain repayments over the longer term.

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.

“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.”