Over a quarter of prospective UK buyers not confident about mortgage applications

19th March 2015

Over a quarter of prospective UK buyers not confident about mortgage applications

Some 28% of prospective buyers in the UK aren't confident their mortgage application will be approved first time and it is even lower among first time buyers, new research has found.

Although 27% plan to seek professional advice, 32% have not yet taken any steps to raise their chances of mortgage approval, according to a new mortgage approval confidence index from Unbiased, an online financial advisor.

Out of a possible 10 points, confidence among prospective homebuyers sits at 5.7, however, the research reveals that both confidence and success can be greatly improved through taking professional mortgage advice from an independent financial adviser, with 81% of advised applications being approved first time.

The research suggests that 32% of UK adults are currently planning to buy a property, but 28% of those who plan to fund their purchase with a mortgage are not confident their first application will be approved. This figure rises to 38% among first time buyers.

Many lenders have recently cut their mortgage rates, which is encouraging for prospective buyers, but the research shows these people are pessimistic about their chances of securing a loan, yet are doing very little to address this.

The most common steps taken to improve the chances of mortgage success are checking credit rating (28%) and making a detailed analysis of all outgoings (25%), but 32% of prospective mortgage applicants say they have taken no action at all in this area.

Although only 19% of prospective mortgage applicants say they have already consulted a professional financial adviser for help with their mortgage application, a further 27% say they plan to do so.

Although first time buyers are less likely than other homebuyers to seek professional mortgage advice, many apparently come to appreciate the benefits of having help with their application.

Mortgage advisers say people moving home make up 37% of their client base, compared to just 26% who are first time buyers. Overall, one in five potential buyers who seek advice from a professional mortgage adviser, do so after having had their initial non-advised application rejected.

Men rank higher on the mortgage confidence index than women at six compared to 5.3, with 66% of men stating they are confident compared to 50% of women. Men are also more likely to have taken action to improve their situation, as 73% have already taken some steps compared to just 60% of women.

Only 21% of women who plan to buy a property with a mortgage say they intend to reduce their spending to increase their chances of having their application approved, 40% have not done anything at all so far, and 33% say they don't plan to take any steps to improve their chances of success.

‘I's great that so many people are looking to get on the property ladder, and the recent spate of good deals from mortgage providers means this figure is likely to rise even higher. Having a concrete goal in mind such as buying a property is a strong incentive to take charge of your finances and take stock of where you are and what you need to do. One big concern from this research is that so many people aren't confident they'll have a mortgage approved, and yet aren't doing anything to increase their chances,’ said Karen Barrett, chief executive of unbiased.co.uk.

‘Getting professional mortgage advice can make a huge difference to the process from finding the best deal for your individual circumstances to planning specific steps to make you a more attractive candidate to a lender. Merely hoping for the best isn't enough,’ she explained.

‘The confidence that comes from having spoken to an expert can turn a potential refusal into a smooth and stress free purchase. Our Mortgage Checklist offers simple steps you can take to start improving your chances of success when you make your application, including the key questions you should be asking your financial adviser,’ she added.


Local Wealth Manager Janan Thompson, based in Winchmore Hill can help you understand your options and discuss the best mortgage deals available to you.

If you are looking to buy or sell a home in Palmers Green please give Anthony Webb Estate Agents a call for some friendly advice and a free valuation on 020 8882 7888