London, United Kingdom (PressExposure) September 23, 2009 -- Despite some encouraging signs from lenders, there has been a shift in perceptions for the worse amongst the public â 33% of Brits now think they can only get between 0.5 times and 2.5 times their salary, compared 31% of Brits at the start of the year. Similarly, only 24% of Brits think they could borrow over 4 times their salary now, compared to 28% of Brits at the start of the year.
In reality, whilst mortgage lenders are still being more conservative than before, as a basic guide most lenders will now offer around 4 times an individualâs annual income3. Those looking for a mortgage also need to ensure they understand deposit sizes, as well as income multiples, as in the current mortgage market to get a good rate they will also need at least a 20% deposit4.
Those living in Wales and the South East have shifted their perceptions of income multiples even further than the UK average since the beginning of the year. 32% of those living in Wales and the South West now believe they can only get a maximum of up to 2.5 times their income, compared to a lesser 28% at the start of the year. Similarly, only 25% of those living in Wales and the South West believe they can get 4 times or more their income now, compared to 33% of those at the start of the year.
People in the South East and East of England also believe the myth that mortgage lenders are tightening their income multiple criteria, meaning they could be missing out on the mortgage they need. 34% believe they can now only get up to 2.5 times their salary compared to 28% at the start of the year. Only 25% believe they can get 4 times or more their income now, compared to a higher 30% at the beginning of Q1 2009.
David Elms, chief executive of Unbiased.co.uk, which offers a 'Find a mortgage adviser' search, comments: "The mortgage market has been going through tremendous change over the past year and lending criteria certainly isnât what it used to be. There is a lot of consumer confusion out there. It is not surprising that many potential homeowners have taken a pessimistic view of lending criteria and what income multiples are available to them.
Unbiased.co.uk's research, which highlights these misconceptions of the mortgage market, urges prospective buyers to visit a whole of market mortgage adviser for the best advice on their mortgage options. Many may be unnecessarily putting off buying a property due to their belief they cannot obtain their required mortgage. A whole of market mortgage adviser can look at all the mortgages available and find the best deal not just by rate but also by income multiple and deposit size.â