Some 23% of home owners in the UK, the equivalent of 2.5 million people, experienced stress during their most recent mortgage application, with poor communication and lack of transparency the main reasons.
New research, published by online broker Trussle during International Stress Awareness Week, highlights the need for the mortgage process needs to be radically improved for the well-being of home owners, according to the firm.
Recalling their most recent mortgage application, 14% home owners said they rarely understood where they were in the process, while 13% found the way that deals were advertised was confusing.
Another stress trigger is the amount of time required to make phone calls during the application process with 27% of borrowers saying that they would have preferred to complete the whole process online.
A dangerous consequence of mortgage stress is that existing home owners shy away from the process later down the line, the firm suggests. It points out that a recent industry report found that over two million people had been sitting on a high-interest Standard Variable Rate deal for more than six months, which according to Trussle research, costs borrowers up to £1,621 over that period.
Trussle’s research also shows that borrowers go for the easy option as one in five or 20% go straight to their current provider to remortgage rather than shop around for a better deal.
‘Buying and owning a home is a huge milestone, yet for so many becomes stressful, simply because our complex and disconnected mortgage system hasn’t adapted to today’s lifestyles,’ said Ishaan Malhi, Trussle chief executive officer.
‘Everyone knows somebody who’s had a nightmare mortgage experience and it’s therefore unsurprising that so many people shy away from the process when it comes to switching. The good news is that things are improving, with technology playing a key role in this progress,’ he explained.
The study also showed that first time buyers are worst affected by the mortgage process, with one in three 25 to 34 year olds suffering stress while 25% of borrowers in this age group found deals confusing, and 29% rarely understood where they were in the application process.
