31% of homebuyers denied mortgage since stamp duty holiday introduction

Thirty-one per cent of homebuyers have been denied a mortgage since the introduction of the stamp duty holiday, a new survey from Market Financial Solutions (MFS) has revealed.

MFS surveyed over 1,200 UK homeowners and buyers to uncover the challenges they are facing within the property market at present, and found that fifty-two per cent of current homeowners want to take advantage of the stamp duty holiday to purchase a new property, but are concerned about their ability to get a mortgage. In addition, forty-three per cent of people who have bought or tried to buy a property in 2020 have encountered significant delays or complications when applying for a mortgage from a bank.

MFS research also showed that 36% of UK adults planning to buy a property in the next year are likely to consider alternative finance options like bridging loans.

Paresh Raja, CEO of MFS, said: “The stamp duty holiday has already had a positive effect on the UK property market, sparking much more activity among buyers and sellers. However, today’s research 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.”

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