Turned down by bank for re-mortgage

Angel-Delight1984 · 21 January 2009 at 9:14PM

My oh applied for a re-mortgage to pay off car finance and much needed home improvements. The bank turned him down because of a few late car payments last year which he could justify as we had problems while switching over to a new bank account. With a re -mortgage his ltv was 63%. He was told had he applied 6 months ago there would have been no problem but due to the credit crunch the banks were tightening their belts. Will this be the case everywhere he looks or is there a chance for him in todays climate? He can more than afford the re-payments as without his car finance his outgoings would work out more or less the same even with a higher interest rate.

herbiesjp · 21 January 2009 at 9:21PM

Rather than risking going to every lender he would be best placed going via an adviser. Having multiple credit searches on his credit file could make things worse.

What you have been told about the credit crunch is correct - and lenders are cherry picking what kind of clients they want.

Get an up to date copy of his credit file and then discuss in details with a whole of market adviser.

Angel-Delight1984 · 21 January 2009 at 9:41PM

Thought as much. He didn't want to keep applying and have it damage his credit. Do you have any idea where we might find a whole of Market advisor? I've seen websites like moneysupermarket but I don't know if they make several applications on your behalf and if so it would be useless asking. Would a downloaded version from eqifax's website suffice or should he find another way to get a copy of his credit report? Thankyou very much for your quick reply.

luckyfool · 21 January 2009 at 9:44PM

Angel-Delight1984 wrote: »

Thought as much. He didn't want to keep applying and have it damage his credit. Do you have any idea where we might find a whole of Market advisor? I've seen websites like moneysupermarket but I don't know if they make several applications on your behalf and if so it would be useless asking. Would a downloaded version from eqifax's website suffice or should he find another way to get a copy of his credit report? Thankyou very much for your quick reply.

Downloadable version is fine, or you can print it to pdf with software like cutepdf (google it to get the software).

With that kind of equity (assuming you are being conservative with your valuation) there should be some options for your OH at reasonable rates.

Angel-Delight1984 · 21 January 2009 at 10:20PM

Currently he has about £75000 in equity taking into account the recent drop in house prices. looking to borrow another £40000 on top of his current £29000 mortgage

herbiesjp · 22 January 2009 at 9:20AM

At that loan to value, and based on those figures, the rates should be pretty good.

However a broker would only be able to see which deals you would fit after you have shown them the credit file - downloaded version is fine.

Moneysupermarket sell off your details to brokers, or their in-house brokers.

They should not make any applications or credit checks, unless they have discussed with you, and you have given them the permission to do so.

Angel-Delight1984 · 22 January 2009 at 3:53PM

Thankyou very much both of you I will take your advice on board and get this sorted. I would have pressed the thankyou button but I can't seem to find it LOL. Thanks again

herbiesjp · 22 January 2009 at 4:08PM

No problem - glad to help

koexelek · 22 January 2009 at 4:51PM

herbiesjp wrote: »

Moneysupermarket sell off your details to brokers, or their in-house brokers.

As far as I am aware, they sell them off to the highest bidder, so there is no emphasis on the sort of quality advice you are likely to get.

I know a few brokers who buy leads off of there. I hear the mortgage leads are quite cheap at the moment, because most mortgages are so difficult to place currently

Angel-Delight1984 · 22 January 2009 at 5:30PM

would your advice be then to go direct to a broker then? And if I do how will I know if they search the whole of the Market and not just the companies who pay them to recommend their products.

herbiesjp · 22 January 2009 at 5:34PM

Yes

Ask them if they are whole of market and if they charge a fee - ask them for their Key Facts Document (otherwise known as Initial Disclsore Document)

Most lenders will pay a fee to the adviser, however the adviser has to explain to you via a suitability letter and via an illustration and research why a deal was the best for you.

In the highly regulated world of mortgages, if you cannot document to the regulator why a product was recommended you are then for the high jump - as you have to be shown to have treated the customer fairly, and offered them the most suitable product

Turned down by bank for re-mortgage

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