The buyers who never even ask

Here is a statistic that should stop you in your tracks. New research from Lloyds Banking Group found that 58% of would-be first time buyers ruled themselves out of getting a mortgage before they ever made an application.

Not declined by a lender. Not turned away by a broker. They simply assumed the answer would be no and never asked the question.

The research went further and looked at why. Almost every reason came down to a myth about how mortgage lending actually works. And the cost of believing those myths is real: 14% of the people surveyed had delayed getting married or having children, 28% had cancelled travel plans, and 64% had cut back on everyday spending to chase a deposit target that may be far bigger than they actually need.

It even found that 27% of people think learning a new language would be easier than buying a home, and 20% reckon running a marathon would be simpler. Buying your first home can feel that way if you are guessing at the rules. It should not, because the rules are knowable. Here are the seven biggest myths from the research, and what lenders actually think.

Myth 1: "I need a 20% deposit"

37% of first time buyers believe a 20% deposit is mandatory. It is not, and it has not been for a long time.

Plenty of lenders offer mortgages at 5% deposit, and some schemes go further still. We have written about how some buyers are getting on the ladder with just £5,000 saved, and how the Lifetime ISA adds a 25% government bonus to what you save towards your first home.

A bigger deposit usually means a better rate, but the gap between "the deposit I need" and "the deposit I think I need" is often years of unnecessary saving. Find out the real number before you plan your life around the wrong one.

Myth 2: "My debts mean an automatic no"

The single biggest misconception in the research: 58% believed their existing debt would stop them being approved.

Lenders do not expect you to be debt free. Car finance, a student loan, credit cards, buy now pay later, all of these are normal parts of modern finances. What lenders assess is affordability: whether your income comfortably covers your commitments plus the new mortgage payment. Debt reduces the amount you can borrow, it very rarely reduces it to zero.

As Amanda Bryden, head of mortgages at Lloyds, put it, lending decisions look at a much broader picture of your finances than any single factor.

Myth 3: "I use my overdraft, so I'll be rejected"

40% worried that an overdraft would trigger a rejection. Dipping into an arranged overdraft now and again is not a dealbreaker. What lenders prefer not to see is an account living permanently at its limit in the months before you apply, and that is fixable with a little planning. A broker can tell you exactly what a lender will want your statements to look like, and how long you need to show it.

Myth 4: "I receive benefits, so I don't qualify"

38% believed receiving benefits would disqualify them. In reality, many lenders accept benefit income within their affordability calculations, including child benefit, universal credit top ups and disability related benefits, often alongside employed income. Every lender treats it differently, which is exactly the sort of criteria detail a whole of market broker deals with every day.

Myth 5: "I've just changed jobs, so I have to wait"

31% thought a recent job change would lead to a decline. Some lenders do want to see time served, but others will lend from day one of a new role, and some will even lend against a signed contract before you have started. A new job with a pay rise can actually improve what you can borrow. The trick is knowing which lender to ask, not waiting a year to ask any of them.

Myth 6: "My credit score isn't perfect, so there's no point"

30% believed a less than perfect credit score meant automatic rejection. There is no single pass mark, and every lender scores you differently against their own criteria. Even genuine past problems, like defaults or a CCJ, do not close every door. We cover this in detail in Credit Scores and Mortgages: What You Need to Know, and if your history is more complicated there are specialist lenders for adverse credit whose whole business is lending to people the high street turns away.

Myth 7: "I'm self-employed, so lenders won't touch me"

24% believed being self-employed would mean rejection. Self-employed borrowers use the same mortgage products as everyone else. The difference is simply how your income is evidenced, and what lenders look for from self-employed applicants varies widely. Some want two or three years of accounts, others will work with one. Our self-employed mortgage page explains how we approach it.

Why guessing is the expensive option

Every myth on this list has the same shape: a blanket "no" where the real answer is "it depends on the lender". No two lenders share the same criteria on deposits, debt, benefits, new jobs, credit history or self-employed income. Rule yourself out based on one imagined rulebook and you are rejecting yourself on behalf of over a hundred lenders who never got the chance to say yes.

This is precisely what a broker is for. As a whole of market brokerage with access to over 100 lenders, our job is to know whose criteria fit your circumstances before any application is made. A mortgage in principle can usually be arranged with a soft credit check, so you can find out where you stand without leaving a mark on your credit file.

The Lloyds research shows 37% of first time buyers are worrying about rejection. The better question is the one most never ask: what could I actually borrow?

Ready to find out where you really stand?

Do not let a myth decide whether you become a homeowner. Our advisers will look at your actual circumstances, tell you honestly what is possible, and match you to the lenders whose criteria fit you.

Start your first time buyer journey with Aspect Mortgages