Refused remortgage can i do anything

oliel

I have been refused additional borrowing on my mortgage by abbey is there anything i can do? I messed up a bit with earnings as my hubby has 2nd job earnings - i also forgot to put proof of child benefit in with application

Heres the details

Current Loan £104933
Additional wanted £22000 (9000 home improvements, rest debt consolidation)
House value £240000
approx LTV 52%

Hubbies main earnings £17500 pa- plus about £1500 pa overtime (based on last 2 years.
2nd job guaranteed earnings £2200 plus about £4000 non guaranteed based on last 2 years.

My earnings £9875 pa (2 days per week)
Child Benefit £1726 pa

Would really like to try and get the additional borrowing I know its not the best way but with 2 young children the plan is to finish our house off (which is adding a fifth bedroom) then when im back working more days in 1 1/2 years - once no.2 is at school we can then overpay and get back on track.

Any advice much appreciated.

herbiesjp

Assuming you are fully aware of the implications of consolidating, then it should be possible.

Firstly try and go back and say that you forgot some other income

They may look at it again - and then they ill give their decision

If they say no, then your only option for a re-mortgage would be another lender.

However, are you currently tied in to your Abbey deal? What is the penalty to leave?

Once you have worked that out, you will then need to find the best deal for your needs with a new lender, by either going direct or via a broker.

However the the fact you are consolidating, and you have the various income streams, may be wiser to go via a broker to make sure you find a lender whose criteria you fit from day one.

oliel

thanks - from what I gathered it was because I didn't put the proof of child benefit in however I slightly over calculated the income by about £1500 when I initially applied but I have given them copies of 3 months wages slips from all jobs. I understand they only take 50% of overtime earnings into consideration however some of the second earnings is guaranteed. They suggested I phone tomorrow as the lady who processed the application wasn't in today. I guess if they still say no I will go to a broker despite redemption penalties as I really want to get our house finished off as soon as possible.

firesidemaid

i'm presuming it depends from lender to lender, but when we remortgaged with FD they would not take any of my contracted overtime (that i have done for 20 years) or any of OH's benefits (as they said any government change could mean no benefits).

you obviously have got good LTV, it's just the income multiples you need to meet.

oliel

Yes I tried FD first as i bank with them they told me to try another lender as criteria does differ quite alot.

firesidemaid

i did RM with FD, as it was such a good deal, but i also had to pay all debts off with savings (at the time it made me money) to get the mortgage.

oliel

Have always been fond of FD they are always soooo nice on the phone and apparently very nice to work for - great family friendly ethics etc.

herbiesjp

Let us know what they say today

natman

oliel wrote: »

I have been refused additional borrowing on my mortgage by abbey is there anything i can do? I messed up a bit with earnings as my hubby has 2nd job earnings - i also forgot to put proof of child benefit in with application

Heres the details

Current Loan £104933
Additional wanted £22000 (9000 home improvements, rest debt consolidation)
House value £240000
approx LTV 52%

Hubbies main earnings £17500 pa- plus about £1500 pa overtime (based on last 2 years.
2nd job guaranteed earnings £2200 plus about £4000 non guaranteed based on last 2 years.

My earnings £9875 pa (2 days per week)
Child Benefit £1726 pa

Would really like to try and get the additional borrowing I know its not the best way but with 2 young children the plan is to finish our house off (which is adding a fifth bedroom) then when im back working more days in 1 1/2 years - once no.2 is at school we can then overpay and get back on track.

Any advice much appreciated.

Hi there!!!
Sorry for asking but am I missing something?

As a rule of thumb a lender is lending around 3 times a combined salary if a couple are purchasing a house and require a mortgage.
These days that has become very strict with proof and evidence required for every penny earned.

Can you tell me if I have worked this out correctly?

Your earnings - £9875 pa (2 days per week) and Child Benefit £1726 pa totalling - £ 11,601
Husband earnings - £17,500 + £1500 = £19000 plus £2200 guaranteed earnings Totalling - £21,200

Total combined earnings - £32, 801
If this was a new mortgage application just going off your figures you should be able to potentially borow around the 100k mark as your current mortgage suggests you have.

You mention you have debt, which banks also look at, and need to consider when lending more money.
I get that you have kids and your time at work may increase, however Borrowing another 22k is quite a lot making the total loan almost 127k.

Its much tougher to get loans and mortgages now, new rules are coming in trying to make the banks responsible for lending too much or lending to a risky situation.

I suppose all I am saying is - your basic earning figures may be a stumbling block, when you are back working on a more full time basis I would be guessing the banks would see your application as a less riskier one.

Keep us posted and let me know if i have done my sums wrong.
Good luck

Just been on the Abbey website Mortgages - http://www.abbey.com/csgs/Satellite?appID=abbey.internet.Abbeycom&c=GSInformacion&canal=CABBEYCOM&cid=1210618119200&empr=Abbeycom&leng=en_GB&pagename=Abbeycom%2FGSInformacion%2FWC_ACOM_MortgageAffordCalc
Basically from your figures you can only get a mortgage for £101, 458

mjhx

Agree with Natman's comments. I had great difficulties with Abbey getting them to accept I satified the 'affordability' criteria and I earn as much as the couple above combined and wanted 2/3 of their mortgage. It took a lot of negotiation to get them to accept they had entered the wrong figures. However the saga goes on...... should have exchanged and completed on my flat yesterday but at midday was told the Abbey had witheld the money. Now demanding written estimates of work that needs doing. None of this was mentioned with the offer or the valuation. Just a note on the very cursory valuation form that some work needed doing. Seems they can vary the offer at will even after my acceptance,

getmore4less

The £13k of other debt is not going to help with the application along with a request for a multiple close to 4 with multiple income streams.

How has the debt been accumulating and for how long?
What have you done to stop this.

You don't need 5 bedrooms for 4 people so the house could wait so you can tackle the debt first.

It is only 1.5 years till you will be earning more so will have a better chance of affording this.

Have you done a SOA?
http://www.makesenseofcards.co.uk/snowcalc.html