Nearly half of first-time buyers have poor mortgage knowledge
Nearly half (46%) of first-time buyers surveyed say they know nothing or very little about mortgages, according to research from Nottingham Building Society.
The mutual said that 15% of those surveyed who are planning to buy their first home confirm they know nothing about mortgages, and 31% say they know very little about them.
When it comes to arranging a mortgage, 18% said they will only consider one from their main bank or building society.
Nearly one in four (38%) say they will use a mortgage broker who can search the entire market, and 31% plan to use an adviser recommended to them by someone they know.
Despite their overall lack of knowledge, many first-time buyers do realise the importance of having a large deposit, according to the research.
Some 7% have set a target of securing a deposit of 30% or more, 21% want 20% or more and 36% want a
deposit of at least 10%. Just 13% are aiming for a deposit of 5%, and 23% are targeting between 5%
Nearly 8% of aspiring first-time buyers currently have £50,000 or more saved as a deposit, and 13%
have between £20,000 and £50,000.
Iain Kirkpatrick, chief customer officer at The Nottingham, said: “It’s encouraging to see that so many of those planning to buy their first home understand the importance of having a healthy deposit.
“However, it is concerning to see so many admit they don’t know enough about mortgages generally, and how to find the best deal.
“Seeking independent advice from an expert adviser can be the key to understanding more and could also save thousands of pounds in repayments.”