By Eleanore D. Sanchez
Mortgage repayments are a primary concern for almost one in three first home buyers, a survey by lender Mortgage Choice revealed.
Its annual First Home Buyer survey showed that 29.2% of respondents said that they worry about not being able to afford their repayments.
Further, 64% of first home buyers who bought a home in the last 24 months revealed that they would have made the purchase sooner had they been given more financial assistance.
The survey also revealed that first home buyers are becoming more dependent on assistance from immediate family to secure a home mortgage. Specifically, almost 5% said they used equity in a family member’s property as additional security for their loan, a notable increase over the 3.9% rate in 2015, and 3.8% in 2014.
“It is quite disconcerting to hear so many first home buyers worry about how they will manage their debt,” Mortgage Choice chief executive John Flavell said. “The reality is, interest rates have never been lower, meaning it should be easier than ever for borrowers to manage their debt.”
“Most first home buyers would have an incredibly competitive rate... a rate they are unlikely to retain for the duration of their loan,” Flavell added. “If first home buyers are worried about meeting and managing their mortgage repayments now, how are they going to feel when interest rates start to rise?”
Instead of fretting over their repayments, Flavell said first home buyers should use the current low interest rate environment as an opportunity “to pre-pay their home loan and ultimately drive their debt down as quickly as possible.”
Collections: Mortgage News