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About 15% of people that are of working age think that the government’s Mortgage Guarantee Scheme could be valid to them, according to a survey of 1,222 UK adults aged between 18 and 54, conducted by self-governing price comparison site NerdWallet.
Only one in five (22%) people below 25 years old think that the scheme could be valid to them.
As well as this, 78% of working-age people felt they did not have a good grip of the full support available to help them get on the property ladder.
The study also covered other important knowledge gaps about mortgages.
For instance, only 17% of under-35s understood that first-time buyers may not require paying stamp duty, and 19% are not aware that mortgage lenders can consider day-to-day spending habits in mortgage applications.
Senior mortgages expert at Nerd Wallet, Richard Eagling, said: “While government-backed 95% mortgages have been welcomed by many, our research suggests that its benefits and advantages may not yet be widely known among potential buyers.
“This scheme is not right for every person but it is a major development for those who would if not be unable to put down a larger mortgage deposit – meaning that many who are not aware of it may miss out on getting a footing on the property ladder.”
“Homebuyers face a major challenge of building a decent deposit, as house price growth has rocketed over the last year this has become more complicated.”
“Around 95% loan-to-values offered mortgages are something of a lifesaver for many borrowers, but if the new mortgage guarantee scheme is going to be a great success then more needs to be done to increase awareness of how it works and who could be qualified.”
Reference Source: Mortgage Introducer
