Challenging mortgage misconceptions
By Pepper Money
The latest Pepper Money Specialist Lending Study has revealed nearly 7 in 10 (69%) people who don't currently own their own home say that they would like to in the future, 22% think it will take more than five years to be in a financial position where they can own their own home. And 36% believe they will never be able to do so.
According to the study, 32% of people say they don't know the deposit size they would need to buy their own home, and a further 32% think they need at least 20% or more.
When you take into consideration, 80% of respondents either think they must wait 3 years or more to be able to apply for a mortgage after receiving a CCJ or do not know at all. Its evident more people could be in a position to apply for a mortgage but do not know it.
Mortgage misconception and a lack of awareness is a big hurdle for hopeful homeowners. Bur an opportunity for our broker partners. The study found that 32% say saving for a deposit is the biggest barrier to homeownership. There are so many mortgage options which could enable more customers to get onto the ladder whether it be concessionary purchase or schemes such as First Homes.
Ryan Brailsford, Director of Business Development at Pepper Money, said: “The Pepper Money Specialist Lending Study surveyed a demographically representative sample of more than 4,000 British adults and has uncovered several misconceptions amongst the population. With nearly two-thirds of potential first time buyers unaware of the size of deposit they would need, or think they need to save at least 20% of the value of their first home, it’s clear that there are thousands of hopeful homeowners out there who have written off their immediate chances to take a first step onto the housing ladder even though they may be in a position to do so.
“At Pepper Money, we support schemes like Shared Ownership, Right to Buy and First Homes as part of our Affordable Homeownership proposition. This range enables First Time Buyers the opportunity to become homeowners with low deposits and are supported by a human approach to underwriting.
The message to brokers is clear – there are customers out there who need your professional advice to help them achieve their homeownership goals and, with lenders like Pepper Money, there are options available to them, even if they miss out on a mortgage from a high street lender.”
The 2024 Pepper Money Specialist Lending Study is available to download now
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