First time buyers lend support to tighter regulations on mortgages
Monday, May 30th, 2011Over three quarters of first time buyers are in favour of banks taking more responsibility when lending money, in spite of the fact that this could lead to more people being turned away from getting a mortgage as a result.
A survey by housing charity Shelter showed that seventy nine percent were of the opinion that banks and building societies were lending irresponsibly before the economic crisis hit, and that there should be tighter regulations on mortgage approvals. Thirty eight percent of those wanting to purchase a new home were in agreement that lenders were less than trustworthy when it came to loans, and didn’t expect this to change any time in the near future.
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Eight out of ten first time buyers were adamant that lenders should only grant mortgages to those who can reasonably afford one, and eighty three percent believed that there should be stronger rules to make sure banks were checking a borrower’s income before approving their mortgage applications Household insurance cover. Almost a third of those asked stated that, when applying, they had been offered a larger mortgage deal than they had originally asked for – or all at least knew someone who had experienced the same treatment.
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Chief executive for the housing charity, Shelter, Campbell Robb, says that the study is an example of what consumers really want in a mortgage service; ‘this survey shows people really want simple, common sense rules in place to ensure people borrow money responsibly.’ Mr Robb commented that the level of support amongst first time buyers was something of a surprise, calling it ‘striking’, and saying it was obvious that they were after a better protection package for themselves and their families, and that this was despite tighter regulations reducing their chances of securing a deal – ‘[first time buyers] are well aware it might limit their chances of getting mortgage credit in the future.’
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