Say What? - FTB's unsure of Mortgage Jargon

Feb. 3, 2009 - PRLog -- New research from the Halifax has revealed that a large proportion of first time buyers are unsure of what the acronyms and technical terms related to mortgage jargon mean, thus making it difficult for them to make an informed decision when it comes to choosing the best product to suit their needs…

When the smoke has cleared and the sheer excitement of deciding to buy your first home has died down, it’s time to face reality and have that dreaded mortgage meeting.

With prices falling and some owners increasingly desperate to sell, in many ways now is an ideal time for first time buyers (FTBs) to be taking that first step onto the UK property ladder. But, despite lower prices, good mortgage deals are becoming increasingly hard to get hold of and this could still prove a stumbling block for some FTBs.

As if the whole buying process wasn’t overwhelming enough for inexperienced buyers, understanding the small print when it comes to which deals are on offer and what would suit your situation best is crucial.

Missing out on the best deal because you don’t understand the terms or the technical jargon could end up costing you thousands and it isn’t a rarity – new research from the Halifax has found that two thirds of first time buyers are confused when it comes to mortgage speak.

Only a third of FTBs can correctly identify the letters KFI with regards to mortgage advice (Key Facts Illustration in case you wondered).

If you are one of the two thirds of FTBs that isn’t sure what this term means – I’ll tell you. A KFI requires all lenders to set out the details of a mortgage product in the same format, so it’s easier for customers to compare mortgages.

Halifax’s website www.buyingyourfirsthome.co.uk gives first time buyers a helping hand by offering a jargon buster, an affordability calculator and an interactive to-do list.

Melanie Bien, Director of independent mortgage broker Savills Private Finance told TheMoveChannel.com, “There is a lot of jargon when it comes to mortgages and for first-time buyers who haven'’t gone through the process before, it can be particularly bewildering.

“It is therefore extremely important that they seek independent mortgage advice. A broker, who has access to all the products on the market, will guide them through the whole process, explain what they don’t understand and metaphorically hold their hand.

“This will ensure they get the right mortgage for their circumstances, understand what they are getting into and don’t make an expensive mistake which they regret at a later date,” added Ms Bien.

Lindsay Hopkins of Trafalgar Square Financial Planning Consultants offers TheMoveChannel.com readers the following advice, “The Financial Services Authority has a selection of financial guidance notes which I suspect most people are not aware of – it is extremely helpful and easy to use. Visit www.moneymadeclear.fsa.gov.uk to read more.”

Are you a first time buyer? Let us know how you are getting on at Catherine@themovechannel.com and we’ll put your experiences, whether good, bad or ugly, in print.

For more information on UK properties and the market in general, please visit http://www.themovechannel.co.uk/

-ENDS-

Notes to editors:

TheMoveChannel.com is a property website that was founded in 1999 as an online resource for buying, selling and learning about property. It now receives as many as 300,000 visits per month and advertises over 50,000 properties in nearly 90 countries, which are listed by over 500 partner organisations.

For further information as well as images and interview possibilities, please contact:

Dan Johnson
Managing Director
www.themovechannel.co.uk
0207 952 7650

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TheMoveChannel.com is a property website that was founded in 1999 as an online resource for buying, selling and learning about property. It now receives as many as 300,000 visits per month and advertises over 50,000 properties in nearly 90 countries.