Atom Bank report highlights pressures caused by rising living costs

April 28, 2026 by Brendan O'Neill

Lenders

A new report published by Atom Bank shows rising living costs pushed more people towards near prime mortgages during the second part of last year.

The lender has just released its latest Near Prime Index and this is one of the major findings contained within it. A total of 71% of the mortgage advisors who took part in the survey said living costs were the main reason their clients wanted near prime mortgages. The number that stated this in the previous Near Prime Index was 62%, so the increase is a considerable one.

In terms of which segment of the buying market makes up the biggest percentage of near prime borrowers, it is those buying for the first time. Advisors told the survey these loans were on the rise among first-time buyers. The bank’s own internal data also shows they make up the majority of its near prime borrowers.

The single biggest reason why borrowers have to look for near prime deals is still defaults. Nearly three quarters (73%) of the applications for those kinds of mortgages that were submitted to Atom Bank were for clients who have previously defaulted.

In 56% of cases, it was due to consumer credit dependence, while for 48% it was because of adverse events in their lives. Most advisors who participated in the survey expect near prime demand among their clients to keep rising this year.

This is not a development that those with the CeMAP qualification will be surprised by, but these mortgages are a bigger risk for borrowers.