Just 50% of potential homebuyers with adverse credit said they would speak to a mortgage broker for advice on obtaining a mortgage, according to the Pepper Money Specialist Lending Study.
This figure was down from the last study, when 58% said they would speak to a broker.
Recommendations from family and friends were the most popular way of finding a broker, with 47% citing this method, while 46% said they would use online research.
Access to lenders not directly available to customers was the primary reason for seeking a broker (67%), followed by the desire to find the best market rate (64%).
Face-to-face advice was preferred by 59% of customers, followed by email (58%) and telephone (50%).
The study also revealed a divide in preferences regarding paying for mortgage advice.
Nearly four in 10 (38%) said it would depend on the broker, while 27% preferred brokers who do not charge a fee – a further 22% were unsure, and 13% said they would prefer to work with a broker who charges a fee.
Rob Barnard, director of intermediary relationships at Pepper Money, said: “There’s been a significant increase in consumer confidence year-on-year, with 1.76 million people with adverse credit planning to buy a property in the next 12 months.
“However, there’s still more work for brokers and lenders to do to encourage customers to realise their mortgage ambitions.
“Especially when you consider the number of customers with adverse credit who say they would speak to a broker for advice is slightly lower than last year.
“Although it’s still a significant number and the growing number of people with adverse credit should mean there will be plenty of chances for brokers to help customers who have slipped up in their finances.”
Barnard added: “According to the research, it seems people are realising the value of professional advice, with the results of the study indicating that customers aren’t put off by paying a fee to a broker for their services.
“In fact, some would proactively prefer to pay a fee as they believe it would secure them more independent advice.”
Kate Fuller, business principal at Mortgage Advice Bureau, said: “For most people, a mortgage is the single largest financial commitment they’ll ever make, and so professional advice is vital for all customers, particularly those who have adverse credit.
“This is why the percentage of mortgages arranged through intermediaries is so high and growing.
“So, while it’s encouraging that half of customers say they would speak to a broker. I personally believe this number should really be much higher.
“The study highlights although an intermediary may not be their first point of call, it is not surprising it is ultimately where circa 85% will end up.
“For me, this is one of the many reasons why the Specialist Lending Study is so important.
“It helps us, not just to better understand customer behaviour, but also to raise awareness of the options that are available and the crucial role of professional mortgage advice.”
