Millennials buying property are the most likely to be affected by stress during the whole process, a new survey has revealed.
According to the survey by online mortgage broker Trussle, 33% of 25-34-year-olds said they suffered from stress while trying to secure a mortgage and a place to live – the highest percentage of any age group assessed. A quarter found mortgage deals confusing, while 29% said they frequently did not fully understand whereabouts they were in the process.
Mortgage process ‘scary’
Overall, Trussle’s analysis of 2,000 people – released to coincide with Stress Awareness Week – found that 25% of all homeowners of all ages had a stressful experience during their most recent mortgage process. Another recent survey from Habito, another online mortgage broker, found that 28% of millennials rated getting a mortgage in their top three fears – and one in 20 would rather break a bone than go through the process again.
The results could also tally with recent figures showing that many people, confused or put off by applying for a mortgage, then sit on a Standard Variable Rate when their initial deal ends.
Studies by the Financial Conduct Authority (FCA) and Which? indicate that an estimated 800,000 people are failing to shop around for a remortgage deal for six months after their fixed deal expires, sitting on their lenders’ more expensive SVR. Trussle also reported that 44% of 25-34-year-olds were more likely to remortgage with their current lender rather than take the time to shop around.
“Everyone knows somebody who’s had a nightmare mortgage experience. It’s therefore unsurprising that so many people shy away from the process when it comes to switching,” said Trussle CEO Ishaan Malhi.
“The good news is that things are improving, with technology playing a key role in this progress. People can now apply for mortgages digitally in the comfort of their own home and out of office hours. They can also have their mortgage constantly monitored by algorithms which tell them when to switch to a new deal and what the best available ones are.”
Industry embracing digital at last?
But it looks like the industry is starting to respond to advances in digital technology. The Royal Bank of Scotland have adopted DigiDocs to enable customers to complete their entire mortgage process digitally. Molo says it can speed applicants for a buy-to-let mortgage through their online system in as little as 15 minutes, and the Land Registry has made moves towards an entirely paperless system.