Good credit, low ltv still refused mortgage

Fairyem1980

Hi

Just wondering if anyone has any advice. I'm 30, I have a very good credit rating, I regularly check my Equifax and Experian report. My house is worth £150k and my mortgage is £44k. We are trying to move house to a property valued at £177k extending mortgage to £98k to cover work to the house too. however we are having trouble getting a mortgage. The mortgage and property will just be in my name as is our current home. With the sale of this property I will be paying off a loan and overdraft (I know frowned upon by some people, as it will increase the amount we need for a mortgage).

Currently our monthly mortagage payments are £350, loan £149 o/d £60, amounting to £559. With the new mortgage, borrowing a little more than we need to and extending payments back to 25years, payments will be about £540, less than we are currently paying. It roughly works out our LTV is about 55%. (Based on my current salary of £27k soon to increase to £30k, in theory I should be able to get a mortgage of £113k)

However we are being refused a mortgage, well I say refused, it has gone to referral. Part of the reason I was given is based on affordability which seems silly to me considering we will be paying less. Baring in mind also we also have my husbands income of £24k which isn't even considered as he isn't on the mortgage.

I think the problem is that in his past my husband had a poor credit rating but for the past year or 2 his finances have been back on track and he makes regular payments to pay back debts and all is under control. This is the reason it is only me on the mortgage, as we know he can't even get credit on a sofa so a mortgage is out of the question. With Experian we have been finacially dissassociated however despite weekly messages to Equifax, I still appear on his credit file owing to a joint account we used to have but is now closed. He doesn't appear on my report though which I think is a little odd as it does make me wonder who elses report I might be on.

I have only contacted mortgage companies who use Experian and not Equifax. Even then some companies said they would need to check his credit file also as we are married but wouldn't take his salary into consideration. Obviously at this point I stopped the appliation so as not to dent my credit record.

So to cut to the chase what I would like to know is-

• Does anyone know of any mortage companies who will be helpful in my situation?
• If I decreased the new morgage from £98K to around £88k, meaning the LTV would be 49.72% would it make them look on our situation more favourably?

Really hope someone can help us out, I just want to move house so we can move on to the next phase of our lives.

Thanks
Em

Meeper

If your application has referred, it isn't necessarily declined. It's referred. Wait for a response before throwing the baby out with the bathwater.

Fairyem1980

Maybe I should have added that we already had one application refused 3 months ago and it wasn't even possible to have it referred, hence my worry.

Thanks for replying though.
Em

Conrad

I quite often try Melton for applications like yours. Thier rates can be high though.

Something to bare in mind is the manner in which you present an application makes a critical difference to outcome. Even little things like not giving a work landline phone number have a detrimental effect on score.

Your husband will be 'viewed' as a cost burden on your income. As you rightly point out his income cannot be used. This is because the regulator and any future repossession court judge would deem using third party income as irresponsible lending.

I suspect your case is doable, so fingers crossed you will get the right result.