Just to set the scene, we recently read a piece in the Independent covering how a staggering two thirds of first time buyers have had their mortgage application rejected. Now, we understand that getting a first time buyer mortgage can be a challenge – but two thirds of the UK? That’s a lot of people.
According to the Yorkshire Building Society, there were 300,000 first time buyers in 2020 – and that’s despite a pandemic. Two thirds of that figure alone is 200,000, which means that there are potentially 50,000 more people than the entire population of the Borough of Guildford (approx. 150,000) struggling to get a first time buyer mortgage.
But there was something else that surprised us when we read the article, too – we simply didn’t recognise these figures.
As a first time buyer mortgage broker in Guildford, we deal with first time buyer mortgage applications on a daily basis. In fact, we’d go as far as to say that first time buyer mortgage applications account for around 30% of our purchase mortgage business.
Yet, we barely have any first time buyer mortgage applications declined. Of course there is a percentage of those applying for a first time mortgage in the UK that are declined, but that figure is less than 5%.
So, what’s happening? Why the disparity? Our view is that instead of realising the benefits of using a mortgage broker, first time buyers are tackling the application on their own. When going it alone, one application generally relies on the decision of one lender.
Conversely, mortgage brokers have a wider pool of lenders to draw on. Complete Mortgages, for example, has a panel in excess of 60. So, if one first time buyer mortgage lender rejects an application, we have plenty of other options available.
Self-applicants don’t have this privilege. A knockback means that the person applying generally has to face the sometimes-Herculean task of going through the entire application process again.
First time buyers should use a mortgage broker in order to increase their chances of success. You may think that it sounds self-serving coming from a mortgage broker, but it’s true. Mortgage brokers have a wider choice of lenders and, generally speaking, long-established relationships with lenders; relationships that first time buyers simply don’t have. When applying on your own, one application equals one lender. When using a mortgage broker, you have multiple bites at the cherry. In many ways it’s a numbers game.
In our view, applying for a mortgage on your own is a false economy – one that can prolong the application process and delay your chances of buying a home.
Getting a first time buyer mortgage really is easier than it sounds; you just need help from a professional.
Get a first time buyer mortgage with Complete Mortgages. Contact our team of Guildford mortgage advisers on 01483 238280 or e-mail us at info@complete-mortgages.co.uk.
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