Scotland will always be distinctive and the same can be said of its mortgage market, which continues to evolve shaped by shifting buyer profiles, regulatory changes, and a growing demand for flexibility.
The Scottish housing market also has one very clear advantage over its English counterpart, according to the June Zoopla house price index. Scottish buyers sell within an average of 18 days largely due to the legal system involved, against 45 days in England or Wales.
But one of the many factors that unites us across the UK no matter which side of the border, is that brokers are increasingly working with customers whose circumstances fall outside of mainstream criteria. Despite increasing demand, there are still fewer lenders operating in Scotland against other parts of the UK. This disparity has left significant gaps in product availability, particularly for borrowers with complex income, modest deposits, or less conventional credit histories.
Filling the complex lending gap
Hinckley & Rugby for Intermediaries has just launched its residential mortgage range in mainland Scotland recognising the opportunity to better serve Scottish brokers and their clients. This marks the first time we have offered our full product range in Scotland and forms part of a wider growth strategy to improve access to flexible, manually underwritten mortgages in underserved areas.
The initial launch, available through PMS Mortgage Club and Sesame Network, brings a broader set of options to brokers who have historically had fewer choices. Scottish borrowers will be able to access the same product criteria and service standards already offered to clients in England and Wales, helping to create greater parity in the types of mortgages available across the UK.
Underserved borrower segments
Among the borrower groups likely to benefit are those with non-standard income. Scotland has a large and growing self-employed population, including contractors and small business owners who may struggle to meet standard affordability assessments. Lenders that consider cases based on one year’s accounts or net profit, will provide an alternative route to homeownership for clients with more variable income patterns.
Individuals with previous credit issues are another underserved group in Scotland, with some finding it difficult to secure a mortgage through lenders with automated credit scoring systems. Lenders willing to work with credit blips like us will be able to support applicants with historic defaults or missed payments, using manual underwriting to assess each case individually.
Affordability continues to be a struggle for first-time buyers striving to save a deposit everywhere. Advisers looking for a wider range of solutions in Scotland for these first-time buyers may welcome a joint borrower, sole proprietor arrangement, or an intergenerational solution with no maximum age on repayment.
Solutions like Tailored Term, which share affordability between younger buyers and older family members, enables applicants to split their borrowing over different timeframes, reflecting varying financial capacities. In one example, a 25-year-old first-time buyer and her 58-year-old father were able to structure a mortgage over 40 and 17 years respectively, significantly reducing monthly repayments compared to a standard joint term.
Foreign nationals and visa applicants
Rising numbers of migrant workers keen to strive and thrive in the UK also represent an opportunity for brokers in Scotland.
Some lenders consider skilled workers and health and care worker visa applicants with no minimum income requirement, no minimum time spent in the UK, and with lending available up to 95% LTV in some cases. This reflects recognition of the stability and contribution of key workers across the country and supports efforts to improve financial inclusion.
When lenders offer manual underwriting on every case taken on, it shows confidence in the skills of underwriters who consider the wider context, rather than relying on credit scores or automated systems. For brokers, this means greater clarity, a more collaborative process, and better outcomes for clients who might otherwise be excluded by rigid criteria.
Look for a lender who will offer strong service and impressive communication skills. This way, brokers will have direct access to decision-makers, helping them to navigate complex cases and progress applications with confidence. This can make a meaningful difference in a market where many brokers are reporting rising challenges in placing specialist cases.
The lenders are coming
Hinckley & Rugby for Intermediaries is clearly not the first UK lender to launch into the Scottish market, but the broader product choice it brings to brokers and their clients and its service-driven approach makes it unique.
The expansion into Scotland also comes at a time of renewed activity across the housing market. Mortgage approvals and sales volumes have suddenly returned to pre-2020 trends, buoyed by interest rate cuts and stronger buyer demand.
Meanwhile, new regulatory changes introduced this summer mean that lenders with under £150 million in annual residential lending can now offer loans above 4.5 times income. This is expected to increase opportunities for first-time buyers in particular, especially those who need higher loan-to-income ratios to step onto the property ladder.
To make the most of this opportunity, borrowers need lenders who are willing to go beyond the standard model. Flexible criteria, tailored affordability tools, and a willingness to take a case-by-case approach are all vital to meeting the needs of a diverse and changing borrower base.
As more lenders like Hinckley & Rugby enter the Scottish market with this mindset, brokers will be better equipped to support a wider range of clients. The result is a more inclusive mortgage market that reflects the realities of modern working life, changing family structures, and the financial challenges facing many would-be homeowners.
For brokers, the message is clear: choice matters. And as new partnerships begin to take shape, there is reason to be optimistic about what’s next for Scottish mortgage lending.
