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While many first-time buyers may think that getting their deposit together is the hardest part of taking that first step onto the property ladder, research from Aldermore reveals that there are several common pitfalls farther along the way.
Their survey found that 25% of first-time homeowners were refused a mortgage from their main bank. Considering the impact that a rejected application can have on your credit score, and therefore your chances of getting a mortgage with your next application, it might be best to look around and see who offers the best rates rather than heading straight for your own bank.
Aside from mortgage application mishaps, many buyers also saw their homeowning dreams vanish before their eyes, as 48% said they've had at least one property purchase fall through, up from 26% last August. Those in London have even worse luck, as 73% of those in the capital said the same.
Such a loss not only dents a buyer's confidence and enthusiasm, but also their wallet, with an average loss on fees and other costs of £2,200. This would have been particularly hard on the 10% who took three attempts before securing a property for good, and means that any would-be buyer will want to add quite a margin to their budget before taking the leap.
If you don't, you may have to delay that all-important first home purchase altogether, with 65% saying they had to do just that and 23% even having to delay their first purchase for more than a year. As a result of all of this uncertainty and worry, 52% said the process of buying made them ill, while 46% said it caused issued in their relationship.
There is light at the end of the tunnel, however, as 79% said that homeownership had made them more financially stable and 81% were confident they'd be able to move up the ladder when they were ready. The announcement last year that means stamp duty is now a thing of the past for first-time buyers looking for a home worth less than £300,000 will also be a big help. And don't forget those Government lending initiatives, including the Help to Buy and Lifetime ISAs, which could make all the difference for those trying to save up for a deposit.
For those who've managed to get together a deposit that is worth 5% of the value of the home they're after, we offer the first-time buyer chart. If you've managed to save up 10% or more, you'll want to take a look at the overall mortgage Best Buys, as these tend to come with lower rates.
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