A&L Mortgage declined - can anyone help?

figgyroo

Sorry in advance for this long post:

I applied to A&L over the phone on Monday for their 3.99% fixed rate mortgage. They said they could lend me £83k with my o/s credit card balance of £1960. I said that I could pay off my credit card with savings (I haven't already done this as the credit card is currently 0%). They said if I did that they would lend me £95k. She put through the application for £95k on the understanding that I would need to prove I had paid the card off before the mortgage started. She said it had been referred to the underwriters.

I rang them today and they said the mortgage had been declined on affordability but that they have sent me a letter which would tell me more. I've received the letter which tells me absolutely nothing, only that if I have further information I think might help I can write to them and ask them to reconsider.

I'm just confused on why it was declined as if they said they will lend that amount on my salary, why have they now decided they won't. I have never missed a payment on any credit arrangements and I have a copy of my credit file so it's nothing to do with my credit score.

I wondered whether it could be to do with one of the following:-

They haven't taken into account that the credit card will be paid off.

I have quite a few credit cards with nil balances, but I do in effect have access to around £15k of credit if I spend on them (which I have no intention of doing, I just haven't cancelled them).

I work in Financial Services an they consider this an 'unsafe' job, which to be fair it probably is at the moment seeing as I've already had a paycut hence why I am applying for a remortgage.

I've been a customer of A&L for over 5 years and have always run my current account fine with them so it's not just a case of them 'not knowing who I am'.

Could anyone shed any light on the reasons for be being declined??

beecher

You could pay off your credit card and send them proof, and see if that makes any difference.

Is your salary multiple high? I'd imagine they're cherry picking people to have that mortgage so maybe they're only accepting safe bets at the moment.

figgyroo

I am applying for a mortgage 4.2 x my salary but I would have applied for a smaller amount (I have savings to reduce it if need be) if they hadn't said they could lend me that amount based on my salary.

Fairwinds

I applied for the same deal and they offered me less than twice salary - which luckily enough was more than I needed - they said it was because the term was only 5 years??? Never missed a payment in 20 years

MrC-117

Could be that it's a high salary multiplier and maybe you need to put in some of the savings. Personally I'd ring them up and moan until they let me speak to someone who could definitely tell you what was wrong.

The number of credit cards never used to matter. They were only interested in outstanding balances and if you had any loans (like a car) that were going on longer than 6 months.

FraudBuster

The number of credit cards never used to matter.

From December 2008, the credit card industry will enhance the data they currently share, to include ‘behavioural data’ on their customers’ accounts. The data shared is being extended in order to help to identify and assist, at an earlier stage, people who may be starting to experience financial difficulties. It will allow lenders to make more informed credit decisions through having a fuller picture of an individual’s ability to repay their debt and will play a significant part in allowing the industry to deliver on responsible lending commitments contained within the Banking Code, as revised in March.

http://www.apacs.org.uk/payment_options/Creditcardbehaviouraldatasharing.html

figgyroo

FraudBuster wrote: »

http://www.apacs.org.uk/payment_options/Creditcardbehaviouraldatasharing.html

See that is what I don't understand. My minimum payment on my credit card at the moment is £50, and I pay around £300 off per month. This does show on my credit file. I have never made a minimum payment on any credit card ever. I have never borrowed more than I can afford to pay back.

figgyroo

Just an update: I paid off my credit cards and appealed to A&L. After waiting nearly a month, I had an offer letter off them yesterday. Valuation done and all seems to be going through ok, fingers crossed!