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.