Pls Help!! Shared ownership/mortgage protection clause

talliedebtbuster

Hi all, can anyone help as ive hit a brick wall

Im buying 60per cent of a property shared ownership.....there is no "mortgage protection clause" contained in the lease....ive had my mortgage offer with woolwich, paid their fees and signed the mortgage deed.....

my solicitor has told me that because the "mortgage protection clause" is not in the lease the woolwich may not approve the mortage....because the condtion of the mortgage is that this clause is contained in the lease....

Yet, my solicitor has sent me the contract papers to sign and asked for me to transfer the mortgage deposit (10k) to "save time later".....

And the housing assocation got thier financial adviser to arrange the mortage for me!! So surely they must have known about this issue?! And the seller has her mortage with the woolwich and used the same solictors when she bought the flat!

Has anyone had a similar situation? Can they really refuse the mortage now after i paid the valuation (£300) fees (£1500) etc....

Any advice id be really greatful.....my solicitor has sent the woolwich the letter yesterday and im currently awaiting "approval" for the morgage so i can exchange contracts

Judith_W

I don't know much about mortgages but I would guess they can still decline but would have to repay your fees (not the valuation fee as that is part of the mortgage process) I'm sure someone else will be along to give better info

opinions4u

talliedebtbuster wrote: »

Im buying 60per cent of a property shared ownership.....there is no "mortgage protection clause" contained in the lease....ive had my mortgage offer with woolwich, paid their fees and signed the mortgage deed.....

The "mortgage protection clause" protects the lender should you not pay. It prioritises their debt ahead of any liability to the housing association.

my solicitor has told me that because the "mortgage protection clause" is not in the lease the woolwich may not approve the mortage....because the condtion of the mortgage is that this clause is contained in the lease....

Most lenders wouldn't lend without this.

Yet, my solicitor has sent me the contract papers to sign and asked for me to transfer the mortgage deposit (10k) to "save time later".....

I'd hold fire for now.

And the housing assocation got thier financial adviser to arrange the mortage for me!! So surely they must have known about this issue?! And the seller has her mortage with the woolwich and used the same solictors when she bought the flat!

The advisor is, in my opinion, liable for any costs you have incurred unreasonably. Lenders can change their criteria, so the vendor's situation is irrelevant.

Has anyone had a similar situation? Can they really refuse the mortage now after i paid the valuation (£300) fees (£1500) etc....

Yes.

You need to get the clause inserted or find another lender (if there is one, which I doubt) who would lend without it. Get your solicitor to earn his fees now!

If you hit a brick wall, I'd suggest that you have been poorly advised and any costs incurred should be refunded. That might be a battle though.

totmalysh

I got a mortgage from Halifax without a protection loan about 1.5 years ago. However, there were 2 people on the mortgage deeds and the shared ownership company was more than happy to sell us the flat as it was one of last 2.
My mortgage adviser also suggested adding the mortgage fee to the actual mortgage, so not to lose out, if we were declined, not that we were.