Robo-adviser to add specialist lenders to panel

Robo-adviser to add specialist lenders to panel

Robo-adviser MortgageGym is set to add four specialist lenders to its panel to accommodate consumers with low credit scores.

From June, the panel will include Together, Precise Mortgages, Kensington Mortgages and Vida Homeloans — all of which deal with adverse credit — to appeal to borrowers who are commonly excluded from high street lenders.

According to MortgageGym, 39 per cent of its online users do not meet traditional lending criteria due to factors outside their control such as sporadic income from freelance work.

On top of this, a recent YouGov survey showed that 54 per cent of mortgage applicants were rejected for having a low credit score, lack of credit history, too much debt, too many credit applications, or for their type of employment.

MortgageGym said to service such applicants, its online portal will automatically direct applicants to brokers who specialise in advising those with lower credit scores and will categorise borrowers into a ‘credit profile tier’.

This advice will be supplemented by new open banking technology that MortgageGym plans to launch this summer, which will match live data from an applicant’s bank accounts to lenders’ internal scorecards

The robo-advice site said it hopes this will provide applicants with surety that they can afford mortgages offered to them for the first time in the UK.

John Ingram, co-founder of MortgageGym, said: "With the nature of work in Britain having transformed dramatically as traditional employment patterns have shifted and a growing spectrum of life styles emerging, the mortgage industry has not kept up with the times.

"A key driver in this shift has been the emergence of the gig economy, zero-hours contracts, a rise in self-employed and people working longer. Many high street lenders have been slow to adapt to such diverse credit cases and borrowers with irregular income."

Mr Ingram said the automated decision-making and rigid criteria that most lenders use resulted in many people becoming locked out of the mortgage market.

He said: "We recognise that the modern way of living means that people have different income streams and as such we can now offer tailored advice to everyone with the introduction of specialist lenders and our new eligibility tool."