FTB 5.99% 5 year fixed advice needed please

bowlingo

Hi all,

I put in an offer on a property yesterday and was accepted today.

I contacted a solicitor and afterwards went through the mortgage application over the phone the mortage is with Natwest and is the 5.99% 5 year fixed FTB deal, no arrangment fee and we have to pay the £275.00 valuation fee.

I passed the initial application process i.e income figures, credit score etc but have the following questions..

It is a joint mortgage application. I have never had a mortgage but my wife had a joint mortgage with her ex partner 20 or so years ago and when they split up he paid her off and took her name off the mortgage.. As of this mortgage terms and conditions I am unsure if this is relevent as its a FTB deal?..if my wife having a mortgage 20 or so years ago is an issue do you think they will find out about it?

Our incomes are as follows

Myself = 2 years accounts 2008-2009 26K and 2007-2008 24K so they have taken an average of 25K

Wife = £142.75 per week which is £37.30 disability living allowance and £105.45 incapacity benefit

We were told we could borrow up to £149000 using the above info the purchase price is £138,100 and we have applied for a £124290 loan and are putting down a £13810 deposit (10%)

Although we have been accepted as of the initial application im wondering how many people get refused past this point i.e if the underwriters reject people further on into the process? I was told they have done a full credit check on us when we made the application earlier and another credit check wont be carried out but from memory the initial application isnt really worth anything and you can easily get rejected further on?

Thanks

northerner79

Hi rate, depends if you want the security of a fixed, who knows how long interest rates will remain low. Have you shopped around, I am suprised this is the best deal you have come across.

bowlingo

Hi Northerner,

Ive had a word with a mortgage advisor and have been looking at what the banks/building societies are offering direct etc and this seems to be the best as all seem to be in the 6-7% range there was one I looked at earlier however that was 5.99% with a free valuation and a £500 IKEA voucher but it had a £199 arrangment fee so it would still be a saving but its not worth the aggro as i see it...Im pretty sure this is a good deal in relation to the current market probably not the best but im confident im not being robbed blind like in the past when some of my friends have got there first mortgage and have told me the repayments in relation to there income and the rates they got etc.

Thanks

bowlingo

Can anyone help me with my original post pretty please

benjo

Im not a mortgage advisor, but I dont mind giving a shot at helping answer your questions...

Yes people can be rejected further on in the process by underwriters - I dont know how many.

Im not sure if further credit checks are carried out I guess it would depend what type of check they did originally ie did they do a soft check for id only and then do a full check later, only one check showed on my file after application (but I only checked experian, perhaps others showed up with the other two companies).

Rejections can be made for a number of reasons ranging from human error inputting data into the original application, the valuation being miles off the purchase price, inability of the applicant to provide hard evidence to back up their application, product withdrawal prior to final agreement, major change in circumstances of the applicant, information incorrectly recorded on credit file - sounds horrible, but Im sure there are more mortgages passing the process silently than there are those who have major problems.

(advice - get your paperwork in order now, get copies of everything you think they might need, 3 months bank statements, proof of income, copy of your credit file, birth certificate, ID driving license/passport, proof of deposit and where it came from, loan agreements, proof of residence etc etc be ready when they ask for evidence, it will speed things up if you dont need to dash around searching)

In terms of the FTB issue and your wife having a mortgage 20 years ago I dont have a definative answer, the same applied to me..

I asked the same question of many people and most, but not all, gave the answer that for the purposes of being in a position to buy - you are in the same position as a FTB (note that doesnt make you a FTB) ie you have no chain and encumberances associated with a non FTB. It is a difficult question, since all of the application forms and comparison sites give you the option of FTB or Remortgage - clearly the first is closer to your position than the second, but only your lender can truely answer since it is only their opinion that matters, give them a ring and ask.

The only thing that stands out is the way your income is made up, self employed and benefits. Not all lenders will take benefits into consideration (I cant find any info on Natwest, but it should be in their KFI), those that do, dont take all benefits into consideration, of the benefits that are taken into consideration - not all are taken at 100% of their value.

If Natwest dont take your wifes benefits then the income multiples on your income alone are above 4 x which might be tight. Did they ask how your income was made up at the time you applied? perhaps they are fine about it, I just dont know.

Goodluck with your application and keep us informed.

Wutang_2

What do you want to know? Whether your wifes previous mortgage will mean a decline later on? (ask them) or if the underwriters will change their mind somewhere along the line? (only they know).

Or is there something else?

by the way I love Ikea

betmunch

That Nat West deal is only for First time buyers, your wife is NOT a first time buyer so they will reject it on that basis.

However, you need to find out what the Nat West's definition of a First Time Buyer is. It is entirely posible that they will consider anyone who has not owned a property for the last x years as a First Time Buyer and therefore you will be fine.

Did they ask on the application if either of you have ever previously owned a property? If they did not ask then it is likely you will be ok as your wifes previous mortgage will not still be on her credit file.

if they did ask and you said neither of you have ever owned a property then you have lied on the application which is fraud.

if they did ask and you said yes, then refer back to the Nat West definition of what a First Time Buyer is.

betmunch

You have piqued my interest so I phoned the NatWest and asked for their definition of a First Time Buyer.

They would not consider your wife a First Time Buyer.

Now you need to remember if they asked, and what you said.

I would not want to apply for a mortgage without being completely honest on the application so I hope for your sake they didnt actually ask the question, and that there is nothing on your wifes credit file indicating that she did own a property in the past.

Let us know how it goes

dimbo61

A five year fix at 5.99% is a good deal and gives you long term security with only 10% in todays market.
Good luck on getting your first home together and if you can overpay the mortgage while also building up an emergency fund of 3/6 months of income.