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Two-fifths of potential homeowners put off by mortgage process – Perenna

  • 28/02/2024
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Two-fifths of potential homeowners put off by mortgage process – Perenna
Some two in five hopeful first-time buyers feel put off from homeownership because of the mortgage process, a survey from a lender uncovered.

A poll of more than 1,000 respondents conducted by Perenna found that 62 per cent of first-time buyers had difficulties getting a large enough mortgage for their purchase. 

This was more notable in London, where property prices are around 34 per cent higher than the rest of the UK. For those buying in the capital, 65 per cent were unable to get the mortgage loan they needed due to their income. 

Because of this, half of the respondents said they were delaying major life events such as marriage or starting a family in order to raise a larger deposit. 


First-time buyer affordability 

Perenna said longer-term fixed rate mortgages could address some of the affordability problems faced by first-time buyers, and 72 per cent of the survey’s respondents said a mortgage without the risk of rising monthly payments would give them more confidence about homeownership. 

Two-fifths said mortgage lenders needed to give first-time buyers more borrowing power, and 48 per cent said that if they were able to borrow more on a mortgage for a purchase, this would be attractive to them. 

Arjan Verbeek, CEO and co-founder of Perenna, said: “It’s a travesty younger people are put off from one of the most rewarding experiences in life – becoming a homeowner. Seeing mortgage payments shoot up for millions of people because of how traditional mortgages work will, of course, put off many would-be homebuyers. We need to change this trajectory urgently.  

“We believe everyone deserves a chance to own their home and enjoy living in it without worry. Longer-term fixed rate mortgages are part of this solution, providing greater borrowing power and stability through payments that don’t shoot up, a far cry from the way traditional high-street mortgages work. Perenna’s goal is to make homeownership a reality for first-time buyers and make us a nation of happy homeowners.” 

Perenna offers mortgages on fixed rate terms ranging from 15 to 40 years, with rates starting at 5.76 per cent for a 90 per cent loan to value (LTV) deal over 30 years with a fee and 5.99 per cent at 95 per cent LTV. 

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