AIP From Leeds Building Society

Pepper07

Hi

My partner has had an AIP for a shared ownership mortgage with Leeds Building Society and i thought receiving that apart from obviously confirming income, documents etc. that we have the mortgage is this the case or do LBS do like RBS and do their credit checks etc after the AIP? (sorry just panicking as i have read a few ppl have been turned down after AIP)

My partner's income per month is £1114 and then he has £494 per month (credit commitments) and we are looking to borrow £31500 - we have the 10% deposit do you think that sounds like they would accept it looking at affordibility - the mortgage payment will be £220 and the rent part £196
I pay all the other bills out of my salary but due to past problems i can't get a mortgage at the min...

thanks for your help i really appreciate it x

Dan_1976

An AIP is not binding in anyway, and a lender can get out of an offer.

However in most cases, as long as your documents match what you told your adviser you should be ok. Also with shared ownership the biggest hassle is to do with the housing association and the lender checking off all the conditions.

I would not worry and go with the flow!

Mrs_Bumble

Has your partner been through the affordability screening with the shared ownership people yet?

Does he have any credit history issues?

Pepper07

hi thanks for your replies

Yes we have been through everything with the HA and they have accepted us on to the scheme as they have taken my income into consideration.

No my partner has a clean credit history do you think looking at the figures and with them giving him an AIP that it likely it will go through okay?

Mrs_Bumble

Were the HA under the impression that you were going onto the mortgage then? I am surprised that they would take your income into consideration if you weren't going to be party to the mortgage.

From an affordability point of view it does look a little snug, is the £1114 before or after tax? What is the annual salary, not including any bonus or overtime?

Pepper07

yes they are aware that i am not going on the mortgage.

his annual income is £16600 so thats £1114 take home pay what do you think? do you think it will go through?
we have been through so much with the HA to get this far and i have a feeling the mortgage will let us down now

thanks for your advice

Mrs_Bumble

I am very surprised that they have taken your income into account then, seems a bit bizarre but hey ho.

On income multiples deducting the credit committments from the salary then it looks ok but if someone pokes around in it and thinks that a single applicant is going to be spending 494 on credit committment, mortgage of 220, rent of 196 which would then leave 204 per month for all other monthly household costs it might raise an eyebrow. You will have to try not to worry and hopefully it will be ok for you.

There is an awful lot of unsecured credit committment there and that potentially is going to put a strain on everything, you will be paying out more on other credit committments than on the property committment, has this been addressed? Which isn't supposed to sound like a lecture or anything, but a friendly observation.

Pepper07

thank you i appreciate your advice and comments - yes we have looked at all our finances and we are just going to run with the credit - it has another 36 months approx but have certainly learnt are lesson not to get into the same position again

i am on £17500 annually and my take home pay is £1166 and i only pay £130 out of that for credit so hopefully we should be able to manage and get all our debts clear - as soon as my credit history has improved i would like the mortgage to be in joint names but for the mo that's not possible.

I will try to stop worrying, thank you if we explained to the mortgage company that i cover the rest of the household bills if it was queried would that suffice??

Mrs_Bumble

When are you going to put the application in?

Hard to say with underwriters these days and so no point in trying to second guess them. Try not to worry and just see what happens.

Pepper07

we are going to view the house on Saturday so if everything is okay we will be submitting the full application over the weekend, fingers crossed! thanks for your help

Mrs_Bumble

Fingers crossed