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  • FIRST POST
    • mustafa786x
    • By mustafa786x 5th Oct 17, 12:10 PM
    • 5Posts
    • 3Thanks
    mustafa786x
    Mortgage withdrawn 2 days before completion and exchange
    • #1
    • 5th Oct 17, 12:10 PM
    Mortgage withdrawn 2 days before completion and exchange 5th Oct 17 at 12:10 PM
    Afternoon Guys,

    First time poster and home owner.


    Background on this case,
    DIP accepted offered a mortgage of £201,000 borrowing at 88% LTV
    Offered on property sale price £150,000 with 88% LTV.
    Accepted all is well,
    Mortgage documents sent, payslips, bank statements, everything required all ok
    Suppose to complete and exchange tomorrow,
    called the solicitors yesterday to confirm everything and they called me back at 3pm stating that nationwide has refused to release funds due to a failed credit check?

    I haven't taken any credit out since the DIP or application, my credit score has actually increased from 933 to 963 in this time,
    They have increased my credit card limit from 11,000 to 13,800 nothing owed on it?
    No missed payments?
    Unsure why I have failed credit score?
    They have offered to lend to me 88% at £201,000 I have chosen to purchase at a much lower property.

    I am only taking out a mortgage of £133,000 not £201,000 well within my borrowing amount

    I have spoken to the broker who said that the underwriter for NW will review this within 24 hours, this was yesterday at 4pm.
    I am struggling to understand why they have withdrawn the offer this late stage 2 days before competing?


    What to do if they refused to lend?
Page 1
    • kingstreet
    • By kingstreet 5th Oct 17, 12:32 PM
    • 32,079 Posts
    • 17,169 Thanks
    kingstreet
    • #2
    • 5th Oct 17, 12:32 PM
    • #2
    • 5th Oct 17, 12:32 PM
    Find a new lender?
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • mustafa786x
    • By mustafa786x 5th Oct 17, 12:34 PM
    • 5 Posts
    • 3 Thanks
    mustafa786x
    • #3
    • 5th Oct 17, 12:34 PM
    • #3
    • 5th Oct 17, 12:34 PM
    Within 24 hours?
    • DoaM
    • By DoaM 5th Oct 17, 12:35 PM
    • 3,333 Posts
    • 3,375 Thanks
    DoaM
    • #4
    • 5th Oct 17, 12:35 PM
    • #4
    • 5th Oct 17, 12:35 PM
    Were you really to be exchanging and completing on the same day? (Note the order).

    This means that the exchange will probably not go ahead and you'll have to find another property. Unless the mortgage gets sorted today ... have you checked with the broker/NW today?
    Diary of a madman
    Walk the line again today
    Entries of confusion
    Dear diary, I'm here to stay
    • kingstreet
    • By kingstreet 5th Oct 17, 12:39 PM
    • 32,079 Posts
    • 17,169 Thanks
    kingstreet
    • #5
    • 5th Oct 17, 12:39 PM
    • #5
    • 5th Oct 17, 12:39 PM
    Within 24 hours?
    Originally posted by mustafa786x
    You haven't exchanged contracts yet, so the 24 hours thing is no longer viable.

    If you have to find a new lender, the chain will have to wait until you can get back to the position you had reached before.

    Ignore the 933, 963 stuff from Experian. That means something only when they start lending money. Something in your financial make-up has changed which has caused Nationwide's opinion of you as a borrower to change. Hopefully, it won't be too much of an issue and your offer will be re-instated.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • JohnnyZee
    • By JohnnyZee 5th Oct 17, 12:47 PM
    • 26 Posts
    • 1 Thanks
    JohnnyZee
    • #6
    • 5th Oct 17, 12:47 PM
    • #6
    • 5th Oct 17, 12:47 PM
    Perhaps this is a blessing in disguise. It is very risky business exchanging and completing on the same day. People have had nightmares. Search the forum and read the stories. Since you may have to delay your timeline/get a new lender, it may be better to leave at least a gap of one week between exchange and completion. Is there any urgency to complete ASAP?
    • Surrey_EA
    • By Surrey_EA 5th Oct 17, 12:50 PM
    • 1,157 Posts
    • 1,355 Thanks
    Surrey_EA
    • #7
    • 5th Oct 17, 12:50 PM
    • #7
    • 5th Oct 17, 12:50 PM
    Do you actually ever have a mortgage offer, as opposed to just a DIP?

    It seems unlikely to me that exchange and completion was ever going to take place tomorrow.
    • Cardinal-Red
    • By Cardinal-Red 5th Oct 17, 1:09 PM
    • 636 Posts
    • 140 Thanks
    Cardinal-Red
    • #8
    • 5th Oct 17, 1:09 PM
    • #8
    • 5th Oct 17, 1:09 PM
    Kind of a mini hijack here - is it normal for a lender to do a second credit check once they have made an offer?

    Is it like the solicitors "final check" on the Land Registry etc?

    I only ask because, unlike the OP, I have bought some stuff on credit in the period between offer made (from HSBC) and completion (end of this month).
    The above facts belong to everybody; the opinions belong to me; the distinction is yours to draw...
    • Surrey_EA
    • By Surrey_EA 5th Oct 17, 1:22 PM
    • 1,157 Posts
    • 1,355 Thanks
    Surrey_EA
    • #9
    • 5th Oct 17, 1:22 PM
    • #9
    • 5th Oct 17, 1:22 PM
    Kind of a mini hijack here - is it normal for a lender to do a second credit check once they have made an offer?

    Is it like the solicitors "final check" on the Land Registry etc?

    I only ask because, unlike the OP, I have bought some stuff on credit in the period between offer made (from HSBC) and completion (end of this month).
    Originally posted by Cardinal-Red
    I do not believe it is normal, but kingstreet better placed to answer.

    From the way the op has worded their post I suspect all they had was a DIP, and never got as far as a full mortgage offer, so there was no offer to be withdrawn.
    • eddddy
    • By eddddy 5th Oct 17, 1:26 PM
    • 5,279 Posts
    • 4,915 Thanks
    eddddy
    DIP accepted offered a mortgage of £201,000 borrowing at 88% LTV
    ...
    called the solicitors yesterday to confirm everything and they called me back at 3pm stating that nationwide has refused to release funds due to a failed credit check?
    Originally posted by mustafa786x
    I'm no expert on this, but was it definitely the Experian credit check?

    They'd have credit checked you for the DIP, but they wouldn't have seen your bank statements (or payslips etc) at that stage.

    Could it be they didn't like something they saw on those?
    e.g. They've spotted a 'regular outgoings' that you hadn't mentioned, or gambling transactions.
    • saajan_12
    • By saajan_12 5th Oct 17, 1:34 PM
    • 848 Posts
    • 556 Thanks
    saajan_12
    Within 24 hours?
    Originally posted by mustafa786x
    You haven't exchanged so you're not tied to the 24hour deadline. Exchange & completion will have to be pushed back until then.

    Perhaps this is a blessing in disguise. It is very risky business exchanging and completing on the same day.
    Originally posted by JohnnyZee
    How? in this case it's better for the OP.. the lender isn't tied in at the point of exchange, and can withdraw the offer if they find new info etc. So, if OP had already exchanged and then the lender withdrew, then OP would be unable to complete and lose their deposit / pay costs to the seller.

    For OP, next time do the same, just try to leave booking things for completion until the day of where possible or be prepared to lose any money spent if exchange/completion don't happen again.
    • pinkteapot
    • By pinkteapot 5th Oct 17, 1:42 PM
    • 6,161 Posts
    • 7,925 Thanks
    pinkteapot
    From what you said, it doesn't sound like you've actually had an offer.

    A DIP is an indication, based on limited information, of what they'll lend. Once you've then found a place and make an offer you put in your full mortgage application. They review the application, and then make you a mortgage offer or decline. You can't exchange contracts until you've received the mortgage offer.

    You mention a broker - it sounds like they haven't done a good job of explaining how the process works. You need to clarify whether (1) the above is correct and you hadn't had your offer yet or (2) you did have an offer, but it's been withdrawn - that's unusual and means the lender approved your full application but then found something out that they didn't like.

    Usually your solicitor will ask about exchange and completion dates after you've got your mortgage offer, though some chains will want it set earlier then for everyone to try to aim for the deadline to get a mortgage lined up.

    What happens now? Your broker chases NW for more information on the decline, and then either talks them round or looks for a new lender for you. If the latter, a fresh application will need to go in to that new lender.
    • Surrey_EA
    • By Surrey_EA 5th Oct 17, 1:46 PM
    • 1,157 Posts
    • 1,355 Thanks
    Surrey_EA

    How? in this case it's better for the OP.. the lender isn't tied in at the point of exchange, and can withdraw the offer if they find new info etc. So, if OP had already exchanged and then the lender withdrew, then OP would be unable to complete and lose their deposit / pay costs to the seller.
    Originally posted by saajan_12
    It is terrifically rare for a mortgage lender to withdraw an offer between exchange and completion.

    In this case it sounds to me like there never was a mortgage offer issued. All the OP had was a DIP, which once the lender investigated further found something they were not happy about and decided not to make a formal offer to lend.
    • kingstreet
    • By kingstreet 5th Oct 17, 2:23 PM
    • 32,079 Posts
    • 17,169 Thanks
    kingstreet
    Kind of a mini hijack here - is it normal for a lender to do a second credit check once they have made an offer?

    Is it like the solicitors "final check" on the Land Registry etc?

    I only ask because, unlike the OP, I have bought some stuff on credit in the period between offer made (from HSBC) and completion (end of this month).
    Originally posted by Cardinal-Red
    Any lender can carry out any checks at any time.

    Routine advice is never to make any application for new credit from the point of obtaining an agreement in principle until after completion has taken place.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • Cardinal-Red
    • By Cardinal-Red 5th Oct 17, 5:19 PM
    • 636 Posts
    • 140 Thanks
    Cardinal-Red
    Any lender can carry out any checks at any time.

    Routine advice is never to make any application for new credit from the point of obtaining an agreement in principle until after completion has taken place.
    Originally posted by kingstreet
    Good to know! I was about to order my 0% card to help with all the new shiny things my wife will want; I'll hold fire for now.
    The above facts belong to everybody; the opinions belong to me; the distinction is yours to draw...
    • JohnnyZee
    • By JohnnyZee 5th Oct 17, 5:20 PM
    • 26 Posts
    • 1 Thanks
    JohnnyZee
    How? in this case it's better for the OP.. the lender isn't tied in at the point of exchange, and can withdraw the offer if they find new info etc. So, if OP had already exchanged and then the lender withdrew, then OP would be unable to complete and lose their deposit / pay costs to the seller.
    Originally posted by saajan_12
    I believe the lender is obliged to give the mortgage once they have given an offer letter to their client. The client is supposed to return in signed within a set time for it to be legally binding. A solicitor would never exchange unless they have seen the offer letter and have confirmed with the bank. So therefore, I do not see any risk of the bank pulling out between exchange and completion. The only exceptional thing I can think off that may affect this is if the bank went down/bankrupt between the period of exchange and completion.
    • nikkit72
    • By nikkit72 5th Oct 17, 8:51 PM
    • 2,428 Posts
    • 10,294 Thanks
    nikkit72
    Kind of a mini hijack here - is it normal for a lender to do a second credit check once they have made an offer?

    Is it like the solicitors "final check" on the Land Registry etc?

    I only ask because, unlike the OP, I have bought some stuff on credit in the period between offer made (from HSBC) and completion (end of this month).
    Originally posted by Cardinal-Red
    YES it is normal for a final check before completion, to make sure no more credithas been taken within offer and completion,
    Good luck, many people have had mortgages withdrawn for taking out more credit as you now have extra payments which were not there at application time,
    Dont forget that little Thanks button , only takes a sec
    • mustafa786x
    • By mustafa786x 5th Oct 17, 8:57 PM
    • 5 Posts
    • 3 Thanks
    mustafa786x
    I had a full mortgage application accepted..
    Bank statements are clean I don't gamble and everything is as it should..

    Good news broker spoke to NW today who stated they had tech issues.

    Completion and exchange is set for tomorrow !
    • zx81
    • By zx81 5th Oct 17, 9:00 PM
    • 13,677 Posts
    • 14,141 Thanks
    zx81
    I believe the lender is obliged to give the mortgage once they have given an offer letter to their client.
    Originally posted by JohnnyZee
    That would certainly not be the case, if circumstances change.
    • harshitguptaiitr
    • By harshitguptaiitr 5th Oct 17, 9:35 PM
    • 80 Posts
    • 12 Thanks
    harshitguptaiitr
    Good news!

    Exchange and completion - be mindful of the order.
    Also just think it through if you really want to exchange and complete on the same day.
    Some solicitors charge extra fees for this service and there can be many issues when exchanging and completing on the same date
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