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Half of buyers denied mortgages despite having agreements in principle – survey

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  • 23/06/2020
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Half of buyers denied mortgages despite having agreements in principle – survey
Some 50 per cent of prospective homebuyers have had a mortgage denied despite having an agreement in principle, a survey of 1,305 adults in the UK has revealed.

 

The survey which was commissioned by Butterfield Mortgages and included people who currently own property or are currently buying. 

It showed a third of buyers lost their deposit due to delays in getting a mortgage as a result of the pandemic. A further 52 per cent said challenges around completing a transaction during lockdown had caused them to be stuck in the property chain. 

Two fifths of respondents said they had pulled out of buying a property after putting in an offer because of uncertainty around Covid-19 and 13 per cent of homeowners decided against selling their property even though they had received offers.  

Also, 16 per cent of homeowners said they had taken advantage of the mortgage payment holiday scheme. An additional 14 per cent said they wanted to use the scheme but had difficulty applying for it through their mortgage provider. 

Alpa Bhakta (pictured), CEO of Butterfield Mortgages, said: “The coronavirus pandemic took the property market by surprise.  

The fact that many mortgage lenders withdrew products or stopped accepting applications during the lockdown has clearly had a damaging effect on property transactions. 

“Positively, there are mortgage lenders who are continuing to issue loans and support homebuyers.  

What’s more, as lockdown measures are eased we are seeing activity return to the UK property market – as a result, demand that has been pent up over recent months might be released, resulting in a flurry of transactions in the second half of 2020, she added. 

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