Mortgages

Growing number of clients unaware they have poor credit

Rozi Jones
|
10th September 2020
Credit score report application paper
"It’s so important that brokers are able to understand a client’s true credit standing and affordability at the outset, so that they can match them with the most suitable lender."

The number of clients who are unaware that they have poor credit files is growing, according to broker forum Cherry.

The research, which was carried out amongst forum users in association with Click2Check, found that 79% of brokers are seeing more clients who are unaware that they have poor credit files.

The main cause of poor credit, cited by 42% of brokers, is missed payments on credit and store cards. More than a quarter (27%) of brokers said the poor credit was due to missed payments on utilities, while 23% said it was caused by mortgage payment holidays.

Donna Hopton, director at Cherry, commented: “The Cherry forum provides brokers with the opportunity to discuss the latest trends and developments in the market, and it’s very clear that clients with poor credit files is a hot topic right now. This makes sense given the economic upheaval people have experienced as a result of Covid-19, but it’s interesting and concerning that so many clients are unaware the impact of missing payments or taking a mortgage payment holiday can have on their credit record.”

David Jones, director of Click2Check, added: “It’s so important that brokers are able to understand a client’s true credit standing and affordability at the outset, so that they can match them with the most suitable lender. This research demonstrates that very often clients are unaware of their true credit status so advisers should have their own systems and processes in place to ensure they don’t waste time chasing after unsuitable lenders. This is where a pre-qualification tool like Credit Assess from Click2Check can prove an invaluable part of the advice process.”

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