Mortgage advisers expect more buy-to-let customers to have adverse credit ratings this year, according to recent research.

Pepper Money found 43 per cent of advisers surveyed said they expected to see a rise in these cases. 

The survey also found brokers were worried about a number of other issues which could potentially impact the buy-to-let sector in 2021.

Top of this list were concerns about tenant rent arrears, cited by almost one in three (29 per cent) advisers.

Meanwhile one in four (25 per cent) respondents said they were concerned about an increase in CGT. Other worries included mortgage rate increases, falling property prices and property void periods.

Pepper Money sales director Paul Adams says: “Landlords have not been immune to the financial impact of the pandemic and there have been many reports of missed rental payments and lost income. So, it’s unsurprising that so many advisers expect to encounter more BTL customers with adverse credit.

“However, our research also found advisers to be confident about the prospects for the buy to let market, with strong demand for both purchase and remortgage business. 

“In order to meet this demand, it will be important to work with lenders that are able to take a pragmatic approach to adverse credit and support this with up-to-date, responsive service and consistent underwriting.”