Student loan changes will affect buyers
Changes to the laws surrounding student loans and credit reference agencies could prevent more first-time buyers (FTBs) getting a mortgage and may affect anyone seeking a fast property sale.
[UKPRwire, Fri Feb 01 2008] Website mform is concerned by the new developments which could have a devastating affect on the UK housing market.
At an, as-yet undecided, date later this year, student default information will be made available to credit reference agencies.
This means many people will find that they can longer secure a mortgage, meaning fewer buyers and more people struggling to make a fast property sale.
"The average student can face debts of over £20,000 by the time they graduate, and their average starting salary is around £16,000," said Francis Ghiloni from mform.
"Given statistics like this, many students miss one or more of their student loan repayments, and this information will soon be made available to credit reference agencies and therefore the banks and financial services companies that use them.
"If they can see a history of missed payments here, they are likely to be less willing to lend… money," he added.
Fast property sale expert Julian King adds, "First time buyers traditionally account for 45-50 per cent of all property transactions.
"This is now more like 20 per cent. With a stark lack of people getting on the ladder and fewer buyers for your property, this will bring prices down further.
"Homeowners who need a quick sale to secure their new property or avoid repossession need to consider options away from the traditional open market approach".
Mr King is a director of National Homebuyers, the UK's leading quick sale property firm, guaranteeing to make an offer on each property surveyed within days with completion at a timescale to suit the vendor. The company also manages the Sell and Rent Back mortgage rescue scheme.