With so many people looking to move home soon, the mortgage sector is under incredible pressure right now. This has been a tough year for this industry, and they have reduced the number of mortgage products available for many prospective clients.
However, as we move forward, there is a greater number of products being made available each month. Also, with the 95% mortgage guarantee scheme now in place, there is no denying that many prospective buyers will find encouragement to enter the market.
If you are looking to buy a home soon, or you are selling and want to be aware of what is happening in the market, it is vital that you familiarise yourself with the challenges of arranging a mortgage at this time.
You are not alone in facing mortgage challenges
The survey carried out by NerdWallet spoke to more than 500 mortgage holders in the United Kingdom. Their findings include:
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Prospective applicants dedicate, on average, 22 hours to reviewing mortgage options
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Prospective applicants speak to just two lenders before applying for a mortgage
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12% of mortgage holders had an application rejected in the past, even though they had received a mortgage offer in principle from this lender
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10% of respondents say they have been rejected for a mortgage application after having taken advantage of a loan repayment holiday
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10% of respondents say they have been knocked back because of a pre-existing debt
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8% have had an application rejected because of their credit score
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9% of applicants said their application was rejected without knowing why
Further information provided by NerdWallet from their analysis indicates:
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48% of mortgage customers found the application process stressful
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50% called upon a mortgage broker for assistance
What help do you need when looking at property?
John Ellmore, Director of Operations at NerdWallet, said: “The UK’s property market has bounced back strongly from the initial lockdown period, with house prices and transactional activity rising sharply. However, the pandemic and subsequent recession might have made mortgage applications more strenuous for prospective homebuyers as lenders tighten their criteria. This can be incredibly frustrating for mortgage applicants – especially when they are rejected for reasons that are largely beyond their control or simply unknown to them. Indeed, applicants who have taken advantage of loan repayment holidays as a consequence of the financial pressures caused by the pandemic may well find themselves unfairly targeted, given that the use of such schemes was not meant to impact on their ability to access credit in the future.”
John also said; “Our research shows that the mortgage market can be difficult to navigate, underlining the importance of thorough research and preparation. Taking time to speak to multiple mortgage lenders and comparing different options online, for example, could save people time and effort when it comes to the actual application process, ensuring they do not pursue unrealistic or inappropriate options.”
If you would like to arrange an appointment to help you negotiate the local housing market, please contact Stones Residential today by calling us on 020 7483 0685 or emailing belsizepark@stonesresidential.co.uk.
