A new study from Santander Mortgages has outlined misconceptions and knowledge gaps among aspiring first-time buyers.
The research – which surveyed 2,000 non-homeowners – comes as Santander launches over 1,000 free in-branch educational events across the UK to offer support on a range of topics – from property viewing to finding a removal company – for those looking to buy their first home.
Top misconceptions among first time buyers
| % of would-be buyers that believed statement to be true | Statement |
| 76% | LTV stands for “Long Term Value” and refers to the projected amount your property is expected to increase in value over the mortgage period |
| 71% | The seller is obliged to tell you about any problems with the property during a viewing |
| 63% | Mortgage interest rates are lower in parts of the UK where house prices are cheaper |
| 62% | “Exchange” happens on moving day and is where you exchange keys |
| 57% | A mortgage lender will let you borrow up to ten times a single or joint income |
| 56% | Buildings insurance is optional when buying a property with a mortgage |
| 45% | It is only your responsibility to insure the new property once you have moved in |
| 43% | If a chain collapses any costs already paid (e.g. legal fees or surveys) will be refunded in full |
| 39% | The interest rate agreed on your mortgage will stay the same for the entire life of your mortgage |
| 26% | Once a seller has verbally accepted your offer, they are legally obliged to sell you their property |
| 23% | House deposits are refunded after the first year of purchasing a property |
| 22% | The estate agent will pay for the survey of the property |
| 8% | Stamp duty is the fee for registering a property with the postal service |
While aspiring new homeowners may lack some knowledge about various aspects of the homebuying process, they are typically prepared for the financial costs associated with getting on the ladder. In fact, on average new buyers are overestimating the typical fees involved for solicitors, surveys, removals and land registration. And while 58% admit they do not know what stamp duty actually is, new buyers are aware that it is an added cost that they must factor into the purchase.
Miguel Sard, managing director, Santander Mortgages, said: “The home buying process can sometimes seem very complicated and old fashioned, with lots of confusing jargon to get your head around.
“While first-time buyers can access a raft of help and advice when it comes to picking the right mortgage, we want to go one step further, helping first-time buyers on the road to homeownership in as many ways as we can. From tips on budgeting to avoiding solicitor scams; buying insurance to having a kettle at the ready on moving day; our new events are designed to arm buyers with everything they need to know to avoid potential pitfalls and get the home that’s right for them.”