Halifax decline on policy reasons - New Build - 85% - 15% shared equity. Help Please

aj+2

I'd go to your developer and ask them if they can recommend a mortgage advisor/broker/lender- if they're offering a shared equity scheme, then they should have a list of preferred brokers, solicitors and a list of mortgage providers who are willing to back their scheme, else the scheme would fail.

Ztan - I have done this and the other bank willing to lend has now stopped as it has reached its limit.

If Halifax have refused, it's possibly for a few reasons:
- budget cuts. With things changing dramatically in the next few months I would not be at all surprised if lenders start panicking again. Do you work in the public sector? They may not be convinced your role is secure and therefore be declining.
- lack of earnings- they may not feel that you earn enough.

Ztan - I do work in the public Sector on a decent wage.

Do you have any negative marks in your credit history? A criminal record? Are you a FTB? Is this a sole mortgage, or are you buying with someone else?

Ztan - No Criminal record, yes FTB, yes Solo Mortgage - Halifax did say it was not my credit history that was the problem.

I called the devloper and they r willing to give a 5% deposit as a gift, hence, I am not going with the shared equity scheme. I am trying to raise the addtional 10 - 15% deposit from parents and hope to go back to halifax. Do u think this is advisable or go with a new bank? will I have to get another survey if I go back to the halifax?

ztan

I don't know if you'd have to do another survey or not... but it's definitely worth doing it that way if you can.

It's never going to be an easy process, but as long as you understand things inside and out then you'll be okay I wish you the best of luck in getting your mortgage, whether that be through Shared Equity or not.

I'd be wary about what the developer start offering you, this time of year, they really struggle to sell houses and may tie you, themselves and your lender in knots just to get a sale.

Again, I'd urge you to keep an open mind, and be wary of doomsdayers on here, who will tell you that Shared Equity, or Ownership is 100% the worst thing that will ever happen to you.
I know plenty of people in a shared scheme who are all getting along just fine- and yes whilst I may be biased as the the benefits of the schemes, I'm not biased enough to say that you should ONLY do it this way.

If you can afford to put down a big deposit, and get a direct mortgage, then by all means go for it! I was not someone who could... (although funnily enough all the people who have seem to be really negative about home ownership as a whole....) but I am lucky enough to have found a house, on a good deal and everything is just peachy.

Don't worry about the implications of repossession etc- lets face it, that's the lenders worry, and not yours, as I'm sure you have no intention of defaulting on your mortgage etc.

Good luck again.

ztan

GMS wrote: »

May be a different issue on this particular case but whatever it is, these schemes are doomed to failure.

Just one point to raise to this comment- if they're doomed to failure... how come so many schemes are still offered, including the previous Home Buy Direct- GOVERNMENT scheme..? and why are there not stories plastered all over the news about how shared equity mortgages are the worst thing ever, failing left right and centre and being pulled due to the massive number of repossessions or people in negative equity...?

I know- because it's a matter of opinion and not the absolute fact.

GMS

ztan wrote: »

Just one point to raise to this comment- if they're doomed to failure... how come so many schemes are still offered, including the previous Home Buy Direct- GOVERNMENT scheme..? and why are there not stories plastered all over the news about how shared equity mortgages are the worst thing ever, failing left right and centre and being pulled due to the massive number of repossessions or people in negative equity...?

I know- because it's a matter of opinion and not the absolute fact.

Developer shared equity involves the developer retaining an interest in the property which often requires a lender to seek permission to repossess.
Developers will dress the deal up so as to make it look like the customer is benefitting. When it comes to completion the lender generally requires an unrestricted first charge. When this is not possible due to third party interest then it can not complete.
All of these schemes are subject to lender acceptance. Up to lenders who they do and dont lend to.
Would you lend money to somebody to buy a house if you had no option to repossess if necessary? If a developer needs to give permission why would they when the house is likely to leave them wiped out? If the developers were willing to go as a second charge then there would be much less of an issue. The fact that they wont tells its own story.

Being a new build also restricts availability. Gifted/equity deposit also causes issues.

I hope the OP manages to sort out a mortgage, and I am glad people like yourself have been able to do so thus far.

This useless coalition we have needs to address the housing situation in this country and do it quickly. If they are in favour of putting these schemes in place then they should also be in favour of arranging the mortgages for them through the banks which they own/control.

Myself and many others on here are grouchoes or any other particular group mentioned in this thread, just realists.

Trollfever

how come so many schemes are still offered,

Where are the mortgage lenders who are interested in getting involved with these complicated schemes?

aj+2

Hi,

Thank you for all your advice, my mortgage adviser has manged to get me a lender willing to borrow on 85%. Fingers crossed for me please and lets see what happens. I will update as the process starts all over again (rolls eyes).

GMS

aj+2 wrote: »

Hi,

Thank you for all your advice, my mortgage adviser has manged to get me a lender willing to borrow on 85%. Fingers crossed for me please and lets see what happens. I will update as the process starts all over again (rolls eyes).

With a 15% deposit from yourself or with the shared equity?