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Nearly half of deposit-ready FTBs lack mortgage knowledge – Nottingham BS

Shekina Tuahene
Written By:
Posted:
May 17, 2022
Updated:
May 17, 2022

Almost half, around 46 per cent, of potential first-time buyers admit to knowing nothing or very little about mortgages.

The Nottingham Building Society’s survey of 1,023 adults in the UK, including 160 who expect to buy their homes in the next five years, found 15 per cent knew nothing about mortgages and 31 per cent said they knew very little. 

The understanding around the need for a sufficient deposit was acknowledged by respondents. Some seven per cent said they wanted to raise a deposit of 30 per cent of more, 21 per cent said they wanted their deposit to cover a fifth of their potential property’s value and 36 per cent aimed to raise a deposit of at least 10 per cent. 

Only 13 per cent of respondents said they were aiming for a five per cent deposit. 

According to the poll, eight per cent of respondents have at least £50,000 saved while 13 per cent have between £20,000 and £50,000. 

Almost a third have saved up to £999 so far and 48 per cent have accumulated between £1,000 and £20,000. 

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When arranging a mortgage, 18 per cent said they would only consider going to their main bank or building society. Around 38 per cent of respondents said they will use a whole of market mortgage broker and 31 per cent said they planned to use an adviser who was recommended to them. 

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.”