HELP NEEDED ASAP: Mortgage refused from HSBC due to new build..!!

maxkpp

Andy, do you know any other bank who will?

Cazza

Generally, no lender will allow this. In addition, all lenders will take into account the monthly payment on the loan and will reduce the amount you can borrow in line with this. Depending on your income, it could therefore reduce the loan amount to an extent that you're unable to borrow the amount you want.

I, personally think your choices are Halifax or walk away. I wuld walk away, the Halifax rate isn't pretty and you will have to pay a higher lending charge. Find somewhere else to rent and sit tight for 2-3 years.

minimike2

I agree with Cazza. Walk away. Get saving.

This might be a blessing in disguise.

_Andy_

+1. Buying a new build at 95% in a falling market = recipe for disaster.

Tiddler_2

I'd agree with alot of the comments here, but would point out that whilst valuers have previously included a "premium" on New Build valuations, that is not the case these days, with properties being valued in comparison to second hand property values, so in a lot of cases buying a new build is no more risky than buying a 2nd hand property in terms of negative equity.

I assume you are buying a house and NOT an apartment, as new build apartments are very difficult to get mortgages on these days

Because of the downturn in sales, the builders are having to reduce the properties significantly just to get people interested in them.

Is the builder providing you with a 5% contribution to your deposit? If not, have they discounted the price of the property?

If they have discounted the property AND you are putting your own 5% deposit into the pot aswell, then you may be able to reword the purchase to be a 5% deposit paid by the builder, and with 5% from your own funds, you would qualify for a 90% mortgage.

The deposit paid incentive HAS to be advised to the mortgage company, so their valuer can assess it with this in mind, but it may (just may) be valued at the new purchase price. You are still borrowing the same amount but qualify for better rates. Such as a Nationwide deal at 6.64% (if i recall correctly) on a 5 year fixed.

maxkpp

Tiddler, i have checked with the developer abt this but although it may seems to be a re-rewording matter from my point of view but apparently not on them, because they have to give precentage to other company on whatever amount of the selling figure. In my case, in order to keep the sold price and add discount, they have to adjust it from say 130 to 135, and it will cost them extra as they apparently need pay more money to the other company.

However,....

I have beed advised to bring this matter to the higher level i.e: complaint department, because the fact that mortgage offer was sent out days before the valuation take place for some strange reason. I have also been told that regardless there is a mistake on the building type i.e: completion date, they should never sent the offer BEFORE valuation..

Do you reckon its viable at all?

wymondham

grade15 wrote: »

new built have 10 yr guarentee with it..?

Does not really come into it as this is in case it falls down/has problems etc... The problem here is the lender knows the value of this property (as well as all newbuilds) is overpriced and likely to fall considerably, hence the large deposit requirement to cover themselves. They want you to lose your money first and they think 25% might cover it! - bleak isnt it, and this in itself should start alarm bells ringing...

another vote for Walk away and save!

ixwood

I think the answer is...... don't buy a new build!!

Why would you?

Alan_M_2

I also vote for walk away......

However, out of pure curiosity, I would approach the house builder and be straight with them about the situation. They may do something to help the situation in order to get a sale.