Mortgage refused after agreement in principle

grey_lady

But people do weekly commutes all the time, some people work from home and live far away from the office - thats really not all that unusual.

MORPH3US

Thrugelmir wrote: »

Defeats the object of what they actually trying to achieve.

How does it?

The object of what they are actually trying to achieve is to buy a house which the bank won't let them have a mortgage on, but will let them have a BTL on (according to the OP). So if they got a BTL and then rented it to themselves they get the house on a mortgage and get to live there.

GMS' post that you cannot rent a house to yourself confirmed my suspicions that this may be the case but that aside I don't see how doing this would defeat the object... only cost them a bit more for the BTL mortgage.

Thrugelmir

MORPH3US wrote: »

How does it?

The object of what they are actually trying to achieve is to buy a house which the bank won't let them have a mortgage on, but will let them have a BTL on (according to the OP). So if they got a BTL and then rented it to themselves they get the house on a mortgage and get to live there.

GMS' post that you cannot rent a house to yourself confirmed my suspicions that this may be the case but that aside I don't see how doing this would defeat the object... only cost them a bit more for the BTL mortgage.

BTL mortgages come with arrangement fees of 1.5% to 3.5% of the capital advance. An expensive way of borrowing money.

opinions4u

It's a few years since I was a residential mortgage underwriter.

But unless there was some sort of compelling reason to lend, I would have declined this and noted that I believed the property was being bought with an intention to let it out.

It would have been one of my quicker decisions of the day and would have been made without considering things like travel costs etc.

A 280 mile communte isn't unreasonable.

Yes it is. Not sustainable.

They did it for three years. My husband and I did it for six months.

And how long is the mortgage for?

grey_lady wrote: »

But people do weekly commutes all the time, some people work from home and live far away from the office - thats really not all that unusual.

Most people don't buy a house knowing that they will have a major commute. Circumstances tend to force that on to them when employers resturcture.

BillTrac

miss_bentley wrote: »

We are honest people.

You may be honest, but are the buyers?

Whether you are honest or not doesn't matter. The lenders look at the people purchasing the house.

And honestly, if lenders weren't a bit more pro-active/sensible now you would be on here bleating how they lent to your son/daughter who didn't have a hope of repaying..

FraudBuster

From the FSA

Reflecting the FSA's enhanced consumer protection strategy and intensive day-to-day supervision, the proposed changes aim to ensure all lenders get back to the basics of responsible lending and that problems are prevented before they can develop or get out of control.

Some of the key proposals include:

• Imposing affordability tests for all mortgages and making lenders ultimately responsible for assessing a consumer's ability to pay;
• Requiring verification of borrowers' income in every case to prevent over inflation of income and to prevent mortgage fraud;
• Extra protection for vulnerable customers with a credit-impaired history.

http://www.fsa.gov.uk/pages/Library/Communication/PR/2010/118.shtml

doctorseuss

So how are you "supposed" to move areas then, whilst proving consistent income? Seems like a catch 22, unless you sell up & rent.

dunstonh

doctorseuss wrote: »

So how are you "supposed" to move areas then, whilst proving consistent income? Seems like a catch 22, unless you sell up & rent.

In those cases, you are being honest with the lender and they can then make an informed lending decision. Maybe its an internal job move with security in place or a new job is lined up.

Conrad

There is very simple way to solve this. L&C will not likely have the requisite experience to do this. An experienced hands on broker will solve this no mproblem.

Conrad

FraudBuster wrote: »

From the FSA

Reflecting the FSA's enhanced consumer protection strategy and intensive day-to-day supervision, the proposed changes aim to ensure all lenders get back to the basics of responsible lending and that problems are prevented before they can develop or get out of control.

http://www.fsa.gov.uk/pages/Library/Communication/PR/2010/118.shtml

Ha ha, but 99% of homeowners never get repossessed. But now a significant portion of the populaqtion will never get the chance of home onwership - how is that fair - you stop a small percentage of 1% getting repo'd but millions are forced to rent.

How about that for unjoined up thinking.

Before you say it my mortgage business is brisk - people need me more than ever. The point is millions of people are now frozen out - not the nliar loan people, just ordinary folk that will now make landlords richer.

Many many people down the years work far from home - my Dad did. 99% of them do not get reposessed. Thje FSA are utterly out of touch. When I meet thier staff they are nearly aqll identicate clone middle class white people who do not have a clue about the real world.