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31% denied a mortgage since stamp duty holiday

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Difficulty accessing mortgages are preventing prospective homebuyers from taking advantage of the stamp duty holiday, according to new research. It found that 52% of current homeowners want to take advantage of the stamp duty holiday, but are concerned about their ability to get a mortgage. Following the introduction of the holiday on 8th July 2020, 32% of prospective homebuyers said they have been denied a mortgage and further 43% have been gazumped.

Almost half (46%) of those who have bought a property in 2020 said they encountered significant delays or complications when applying for a mortgage from a bank. The research also showed that 36% are planning to buy a property in the next year are likely to consider alternative finance options.

The stamp duty holiday has already had both a good and bad effect on the property market, sparking much more activity among buyers and sellers. However it shows that many prospective homebuyers are unable to take advantage of this initiative.

Frustratingly, this is often due to the challenges of securing a mortgage, which are beyond buyers’ control. Many banks are treading carefully and, as a result, applications are taking longer to process and there is a higher chance of an application being rejected. This is putting property chains at risk of collapsing. At this point in time, it is important that lenders keep lending – they must ensure buyers have access to the finance needed to complete on a purchase. Failing this, the Stamp Duty holiday will only have a limited effect.

Posted by MMB Finance Swindon on 10 September 2020