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Ignorant first-time buyers risk rejection

First-time buyers applying for their first mortgage lack knowledge about the application process and risk being rejected as a result.

Almost half have no idea how mortgage affordability rules might impact their application.

Even more worryingly, nearly one in five have missed payments on credit agreements, according to new research by credit information provider Equifax.


First-time buyers were surveyed by Equifax and What Mortgage magazine in February and 48% were unaware of the impact of mortgage of affordability rules.

The results also showed that 18% have missed payments on credit agreements, while 28% have saved a deposit of just 5% or less.

A similar number believe they will still be paying off their mortgage into retirement.

Lisa Hardstaff, credit information expert at Equifax, said: “Mortgage lenders will take a good look at a person’s financial situation when assessing an application and if they have missed or made a late payment on a credit or service agreement, this could be a cause for concern.

“Also having too many credit agreements could indicate a person is financially overstretching themselves, too few, and a lender may find it difficult to assess how the person will perform with repaying their mortgage."

Hardstaff urged borrowers to check their credit report at least six months before submitting a mortgage application.

The research also revealed that raising a deposit remains a major challenge for first-time buyers.  

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    I told some First Time Buyers to get a copy of their Experian Credit Report and "tidy it up" before they applied for a Mortgage. They cleared all their Credit Cards with Balance Transfers to 0% Credit Cards and they also got a Personal Loan which still showed as outstanding but was paid off amended to show that it had been paid off. They then used the Lenders Webb Site again to see how much they could borrow and the new Loan amount was higher!
    I also told other First Time Buyers who had no credit history to get a couple of Credit Cards, use them for a couple of months, pay them off in full each month to improve their Credit History.
    Paul, Hertfordshire


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