Securing that first time buyer mortgage is easier than last year

A recent report by The Halifax reveals that the average deposit in the first half of 2011 is 8% lower than for the same period last year. The report also states that more towns in the UK are affordable to first time buyers than at any time since 2003. This is all good news for those aspiring first home owners considering taking that first step.

However, with the average deposit standing at over £27000, in a large proportion of cases, parental input is required. A survey by first time buyers’ website FirstRungNow.com of over 2000 aspiring home owners reveals that the hard truth about getting a first time buyer mortgage together is sinking in. Of over 2000 respondents, over 26% fully expected their parents to have to help out with the mortgage.

Helen Adams, founder of the on-line news and advice centre comments: “With property prices still so high and first time buyer mortgages still fairly hard to come by – though a little easier than last year - parents are invariably getting involved by lending or donating a deposit. Further research by FirstRungNow.com reveals that 28% of the respondents also expect their parents to help out with the deposit, by harnessing their earning power, acting as guarantor or depositing a proportion of the property’s value into a special savings account.”

Whilst in the past some first time buyer mortgage applicants have had their applications turned down because of poor credit ratings, 73% know that even defaulting on a phone contract can affect them almost 60% know where to find their credit ratings.

With property prices currently stabilising and first time buyers feeling rather despondent about their house-buying future, lenders are keen for it to be known that they do not turn down as many applications and it may seem.

Adams advises: “Although lenders find first time buyers more costly to deal with, there is a propensity to lend to good borrowers – aspiring home owners should seek first time buyer mortgage advice on line and speak to mortgage advisors who cover the whole of the market rather than focusing on just one lender.”