Common First-Time Buyer Mortgage Myths Busted

Many people assume getting a mortgage is harder than it really is.

While affordability is still a challenge for some, changes in the mortgage market mean many would-be buyers have more options than they realise.

Recent research shows that outdated assumptions continue to stop people from taking their first steps into home ownership.

My Deposit Isn’t Big Enough

One of the most common misconceptions is that buyers need a large deposit to secure a mortgage.

Research found that more than half of aspiring buyers believed a minimum deposit of 10 percent was required, while others were unsure of the rules.

In reality, it is possible to obtain a mortgage with a 5 percent deposit.

Following changes to lending criteria, the number of 5 percent deposit mortgage products available is now at its highest level in many years.

I Don’t Earn Enough

Another widespread belief is that buyers can only borrow up to three times their annual income.

While this was once common, most lenders now work to higher income multiples.

Many banks are prepared to lend between 4.75 and 5 times income, depending on individual circumstances.

Data from mortgage brokers suggests the average first-time buyer currently borrows just over four times their income.

I Can’t Get a Mortgage Because I’m Self-Employed

Self-employed buyers often assume they are at a disadvantage when applying for a mortgage.

A significant number believe they need three years of accounts before they can even be considered.

While this may have been true in the past, many lenders now accept one or two years of certified accounts.

Requirements vary between lenders, but being self-employed does not automatically exclude you from the mortgage market.

Why It’s Worth Taking Another Look

For a long time, getting onto the property ladder felt out of reach for many first-time buyers.

However, as the mortgage market has evolved, some of the barriers have reduced.

If you previously assumed your income, deposit or employment status ruled you out, it may be worth reassessing your options.

Up-to-date advice can make a real difference.

If you are considering buying your first home in Runcorn and would like guidance on your options, contact HomeSmart Estates on 01928 246 888.

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The information in this article does not constitute financial advice.