More than half of prospective first-time buyers believe getting accepted for a mortgage is difficult, despite evidence suggesting professional advice can significantly improve their chances of navigating the market.
Research from Yorkshire Building Society finds 56% of prospective first-time buyers think securing a mortgage is difficult, while even 40% of existing homeowners share the same perception.
Deposit requirements remain a major concern, with 39% of prospective buyers identifying the amount they need to save as one of the biggest barriers to homeownership.
The perception is particularly pronounced among people who have remained in the rental market. Almost two-thirds (65%) of repeat renters who do not expect to buy believe they would find it difficult to be accepted for a mortgage.
ADVICE CLOSES THE KNOWLEDGE GAP
However, Yorkshire Building Society’s No Way Home? Restoring Britain’s Housing Ladder report suggests there is a considerable gap between perceptions of the mortgage market and the experiences of people who seek professional help.
More than seven in 10 (71%) people who have used mortgage advice say it made buying a home easier, compared with just 5% who believe it made the process more difficult.
Some 15% of aspiring buyers also identify a lack of understanding or education about mortgages as a barrier.
Separate Building Societies Association research found 47% of people who want to own a home have never spoken to a lender or mortgage broker about the options available to them.
After being shown low or no-deposit mortgage options, 67% of aspiring buyers said they could potentially buy sooner than they had previously thought.
MORTGAGES ‘WIDELY PERCEIVED AS INACCESSIBLE’
Tom Simpson, Managing Director of Homes at Yorkshire Building Society, says: “For many aspiring homeowners, the challenge is not simply affordability – it’s understanding what options are available to them and how to navigate an increasingly complex mortgage market.
“Our findings show that mortgages are widely perceived as inaccessible, yet those who seek advice are far more likely to have a positive experience.
“This demonstrates the gap between perception and the experience of many borrowers who opt for professional support, and highlights the essential part played by advisers in helping people understand what’s available and move forward with confidence.
“As affordability pressures continue to affect households across the country, brokers can provide education, reassurance and tailored guidance, to help borrowers to prepare earlier and make informed decisions to help them achieve their homeownership dreams.”
Rachel Geddes, Strategic Lender Relationship Director at Mortgage Advice Bureau, adds: “Accord’s findings mirror exactly what we’ve seen in our own research into first-time buyer sentiment. Prospective buyers aren’t short on ambition – they’re short on information.
“That’s not a small knowledge gap: it’s a fundamental misunderstanding of what’s available. Mortgage products and criteria have moved on faster than consumer understanding has, which is where an adviser is irreplaceable.
“The gap between perception and reality is closable – it simply needs a conversation.”
