A total of 41% of five first-time buyers struggle to understand the mortgage options available to them, new research suggests.
The findings by Moneybox were based on a survey of 500 first-time buyers who have bought a property in the past two years.
It also found that two fifths found it difficult to secure a mortgage suitable for their financial situation, while – of those who faced difficulties – 39% regretted not using a mortgage broker.
In addition, 43% said they wished that they had spent more time researching the mortgage options available to them.
Best mortgage outcomes
Felicity Holloway, head of mortgages at Moneybox, said: “Buying a home is the biggest financial commitment most of us will make in life, so it’s understandable that so many first-time buyers are calling out for more guidance and support throughout their homebuying journey.
“Yet, our research shows that a surprising number of people are not using the services of a mortgage broker, and so are missing out on freely available expertise and guidance that could prove to be invaluable in helping them achieve the best outcomes possible.
“We also know first-hand that even among those who engage a broker, many wait until they’ve had an offer on a property accepted.
“It’s disappointing, but perhaps not surprising, to see that eight out of 10 of the recently successful homebuyers we surveyed said that, in retrospect, there are certain things they wish they had done differently.”
More financial support
The survey went on to suggest that 37% believe there need to be greater financial support for first-time buyers.
This includes more government support.
Many first-time buyers continue to struggle to get onto the property ladder and end up needing the help of the Bank of Mum and Dad.
Separate findings by the property group Savills suggested the Bank of Mum and Dad is a big provider of such financial assistance, with around £30bn to be expected to be gifted to first-time buyers in the next three years.
Meanwhile, the Moneybox research went on to reveal that a total of 28% of first-time buyers felt more needs to be done to help people find a suitable mortgage broker.
Finding a suitable solicitor and surveyor is also an issue, with 27% saying they would value guidance in these areas.
Holloway added: “As an industry, we must do more to break down the barriers that are preventing people from finding the information they need and to support them in making financial decisions throughout their homebuying journey with greater confidence.
“What more can be done to engage and support first-time buyers earlier in their homebuying journey? How can we collectively better educate this community on the services available and how they can help? How can we ensure greater transparency around the perceived differences between different broker business models i.e., free or fee-paying, to ensure brokers services are better underwood and accessible to all?
“These simple steps could make a huge difference to the lives of the next generation of homebuyers in the UK.”
