1.34m potential homebuyers have adverse credit

15% of respondents, the equivalent of 7.86m people across the UK, have experienced credit problems, including missed payments, CCJs, defaults, unsecured arrears and secured arrears, in the last three years.

Of these, 17% of people are thinking about buying a property in the next 12 months, which means 1.34m people could potentially need support from a broker.

This number has increased by nearly 80,000 since Pepper Money's last study in October, when it was found that 1.26m people with adverse credit were thinking about buying a home in the next 12 months.

Paul Adams, sales director at Pepper Money, said: “Six months ago, we carried out research that showed the potential adverse credit mortgage market was larger than probably anybody had assumed and this latest data indicates that the number of people with adverse credit who are looking for a mortgage is on the rise.

“The total population of people with adverse credit has not actually changed since the last wave of research and still stands at 15% of adults. However, more of these people intend to purchase a property in the next 12 months, up slightly from 16% to 17%, which equates to an increase in the potential adverse credit mortgage market of nearly 80,000. This increase has been driven by more people with adverse credit intending to purchase Buy to Let property to rent out in the next year, and highlights an important growth market for brokers.”