- 46% of those surveyed say they know nothing or very little about mortgages
- 18% will only consider a mortgage from their bank or building society
- 21% of would-be first-time buyers have over £20,000 saved as deposits
New research (1) from the Nottingham Building Society reveals that despite many would-be first-time buyers amassing sizeable deposits, many admit to having poor mortgage knowledge.
The Nottingham’s findings reveal that 15% of those surveyed who are planning to buy their first home confirm they know nothing about mortgages, and 31% say they know very little about them.
When it comes to arranging a mortgage, 18% will only consider one from their main bank or building society. Nearly one in four (38%) say they will use a mortgage broker who can search the entire market, and 31% plan to use an adviser recommended to them by someone they know.
Despite this, many first-time buyers do realise the importance of having a large deposit. Some 7% have set a target of securing a deposit of 30% or more, 21% want 20% or more and 36% want a deposit of at least 10%. Just 13% are aiming for a deposit of 5%, and 23% are targeting between 5% and 10%.
Some 8% of would-be first-time buyers currently have £50,000 or more saved as a deposit, and 13% have between £20,000 and £50,000.
| Amount saved | Percentage of would-be first-time buyers who have this amount saved as a deposit |
| Up to £999 | 31% |
| Between £1,000 and £4,999 | 19% |
| Between £5,000 and £9,999 | 16% |
| Between £10,000 and £19,999 | 13% |
| Between £20,000 and £29,999 | 9% |
| Between £30,000 and £49,999 | 4% |
| £50,000 or more | 8% |
Iain Kirkpatrick, Chief Customer Officer at The Nottingham, said: “It’s encouraging to see that so many of those planning to buy their first home understand the importance of having a healthy deposit.
“However, it is concerning to see so many admit they don’t know enough about mortgages generally, and how to find the best deal. Seeking independent advice from an expert adviser can be the key to understanding more and could also save thousands of pounds in repayments.”
The Nottingham offers access to products available from over 90 lenders via expert Mortgage Advice Bureau advisers, so customers can be sure they get the right deal for them. This can be accessed in-branch, by phone or via its online savings platform Beehive Money at www.beehivemoney.co.uk.
