Mortgage Help - turned down at the last hurdle!

muffin07

Can anyone help???

We sold our house a couple of months ago and bought (stc) about 4 weeks ago. Our current mortgage lender is Chelsea and for the last 2 weeks they have said that porting our current mortgage across for our new house wouldn't be a problem and we received an AIP. My husband is self employed and they came back to us about a week ago suggesting that he needs to have 3 years accounts otherwise their "system" says that the mortgage is unaffordable! He has 2 years and 11 months!!!!!!!! They then went away and said they will be able to sort it out anyway and it went to the underwriters. They left us on pins for a couple of days saying all was going fine, only to tell us that they can't overide the "system" and so we can't have the mortgage!!!

We were due to exchange on Tuesday!! We are in a very awkward situation as we need to move asap (I won't go into the fine detail but it involves health reasons and financial.) Our chain is very small thank goodness and yet our buyer has already waited 2 months as the initial house we were purchasing pulled out. We are really worried that it may all fall through if it means our buyer and seller now have to wait a further 2 months and all because we need to wait until we have 3 years accounts and the "system" says our mortgage is affordable!!!

So, we have seen a mortgage advisor at the estate agents from who we have sold with and we weren't impressed or overly helped and it has left us worrying somewhat. He suggested that we may be able to get a mortgage with another provider, yet we will incur a hefty get out payment with Chelsea and it may also involve having to pay off our loans and debts to be accepted!!!!! Oh and then there is his commision payment!! It just isn't realistic and could put us in a financial mess if we were to have to do that and so the only option is to wait a further 2 months and hope that our buyer and seller are prepared to wait also. That said, we can't really wait that long.......

Is there anything we can do????? Is there anyway of getting around Chelsea's "system" so that we can stay with them and get accepted? Or, can we go with someone else whom wouldn't require us to pay off debts beforehand etc and would accept our 2 years and 11 months accounts?

Thanks for any advice and help - truly appreciated and much needed.

muffin07

That's a worry - 60 views and no replies.......... is there no hope??

beecher2

Go and see another mortgage adviser as soon as possible.

Is it worth asking Chelsea what would happen if you sold, rented for a few months and then bought again - ask them if they'd reimburse your ERC in that set of circumstances. I'd say selling should be a priority as it is a buyer's market and your buyer may well see this as the final straw and walk away.

_Andy_

muffin07 wrote: »

That's a worry - 60 views and no replies.......... is there no hope??

You only gave it an hour!

hcb42

is this a duplicate thread??

trulysaintly

muffin07 wrote: »

Can anyone help???

We sold our house a couple of months ago and bought (stc) about 4 weeks ago. Our current mortgage lender is Chelsea and for the last 2 weeks they have said that porting our current mortgage across for our new house wouldn't be a problem and we received an AIP. My husband is self employed and they came back to us about a week ago suggesting that he needs to have 3 years accounts otherwise their "system" says that the mortgage is unaffordable! He has 2 years and 11 months!!!!!!!! They then went away and said they will be able to sort it out anyway and it went to the underwriters. They left us on pins for a couple of days saying all was going fine, only to tell us that they can't overide the "system" and so we can't have the mortgage!!!

We were due to exchange on Tuesday!! We are in a very awkward situation as we need to move asap (I won't go into the fine detail but it involves health reasons and financial.) Our chain is very small thank goodness and yet our buyer has already waited 2 months as the initial house we were purchasing pulled out. We are really worried that it may all fall through if it means our buyer and seller now have to wait a further 2 months and all because we need to wait until we have 3 years accounts and the "system" says our mortgage is affordable!!!

So, we have seen a mortgage advisor at the estate agents from who we have sold with and we weren't impressed or overly helped and it has left us worrying somewhat. He suggested that we may be able to get a mortgage with another provider, yet we will incur a hefty get out payment with Chelsea and it may also involve having to pay off our loans and debts to be accepted!!!!! Oh and then there is his commision payment!! It just isn't realistic and could put us in a financial mess if we were to have to do that and so the only option is to wait a further 2 months and hope that our buyer and seller are prepared to wait also. That said, we can't really wait that long.......

Is there anything we can do????? Is there anyway of getting around Chelsea's "system" so that we can stay with them and get accepted? Or, can we go with someone else whom wouldn't require us to pay off debts beforehand etc and would accept our 2 years and 11 months accounts?

Thanks for any advice and help - truly appreciated and much needed.

Most lenders would consider you with 2yrs worth of accounts - but did you go directly to Chelsea for this new mortgage, or through a broker?

If you went through a broker, they will have a lender contact who could speak to an underwriter further.

It does seem rather odd - most lenders, would ask for a projection of the 3rd year if it was that important, but if the 3rd year wasn't yet complete. Without knowing your own circumstances, if the accounts showed a decrease in income, they may be looking to spot a trend.

Looking elsewhere, some estate agency advisers are not whole of market - so therefore may not be looking at the whole market for you anyway - some of the more traditional building societies are showing more flexibility at the moment.

The other adviser could well be completely right in what he says - if you have other financial commitments, then these will affect the amount you could borrow.

Early repayment charges are normally only avoidable if you are transferring the existing mortgage with the same lender - you could look to cover the penalty in the new borrowing elsewhere, but as with most things it depends on your overall circumstances.

Before going independent I used to work for High Street lenders, including underwriting applications.

I hope this information helps.

muffin07

hcb42 - yes it is, I've found that posting in a couple of different places gets a better response and it has proven this way which is a great help.

trulysaintly - thanks for your help. They intially asked for a projection figure and this was provided, it also went to the underwriters. All they came back with, was that until we have 3 years accounts, they can't overide the system. All is adequate and once they have the final month, they are offering us a mortgage of well over what we need. We didn't go through a broker as we are already with Chelsea and have been for many years which is what annoys us even more! We simply ported across for our new house/mortgage. Is there someone else we could speak to maybe within Chelsea? Or are they all going to say, it's the system and we can't overide it!? Our debts may well be hindering how much we can borrow as the advisor at the agents was only working with 2 years accounts. I have wondered if Halifax/RBS would be an option as we both bank with them and my husbands business account is with them.... As long as they don't take me into consideration though as my account with them is in the red and has been for some time since I lost my job, I also have 2 credit cards with them that have a fair amount on them and I am only able to pay back the min each month. That said, my husbands accounts with them are really good so would that help?

If we have to wait a further 2 months (a month for the 3rd year account and a further month to reapply, survery etc) to move, we are worried that our buyer and seller may pull out, that and for reasons I would rather not go into (not financial) we need to move asap also.

Thanks for the help so far and anything further, much appreciated.

trulysaintly

muffin07 wrote: »

hcb42 - yes it is, I've found that posting in a couple of different places gets a better response and it has proven this way which is a great help.

trulysaintly - thanks for your help. They intially asked for a projection figure and this was provided, it also went to the underwriters. All they came back with, was that until we have 3 years accounts, they can't overide the system. All is adequate and once they have the final month, they are offering us a mortgage of well over what we need. We didn't go through a broker as we are already with Chelsea and have been for many years which is what annoys us even more! We simply ported across for our new house/mortgage. Is there someone else we could speak to maybe within Chelsea? Or are they all going to say, it's the system and we can't overide it!? Our debts may well be hindering how much we can borrow as the advisor at the agents was only working with 2 years accounts. I have wondered if Halifax/RBS would be an option as we both bank with them and my husbands business account is with them.... As long as they don't take me into consideration though as my account with them is in the red and has been for some time since I lost my job, I also have 2 credit cards with them that have a fair amount on them and I am only able to pay back the min each month. That said, my husbands accounts with them are really good so would that help?

If we have to wait a further 2 months (a month for the 3rd year account and a further month to reapply, survery etc) to move, we are worried that our buyer and seller may pull out, that and for reasons I would rather not go into (not financial) we need to move asap also.

Thanks for the help so far and anything further, much appreciated.

Something doesn't add up - lending policy is set, therefore if they originally said that they'd offer based on 2yrs and a projection, then now they're just trying to move the goalposts.

The adviser at the agents should have asked you whether a projection of yr3 was available, as some lenders do work on these.

I would go back to Chelsea first, explain your situation and that if they delay you could lose the house - many lenders are behind their own lending targets, so they can't afford to lose your business.

Alternatively, you could tell them that you'll have to consider other lenders if they can't help you (for the sake of 4wks that's ridiculous).

Then speak to an independent adviser if they won't play ball. It will be much quicker.

Thrugelmir

muffin07 wrote: »

As long as they don't take me into consideration though as my account with them is in the red and has been for some time since I lost my job, I also have 2 credit cards with them that have a fair amount on them and I am only able to pay back the min each month.

Gut instinct says that you haven't reached the last hurdle. As the underwriters for obvious reasons will be taking a close look at your finances. In fact what you believe to be the case may not well be. As underwriters as a rule keep their full views to themselves.

kingstreet

What was the loan to value when you bought the current property and what's the loan to value for the new purchase? What's your husband's net profit for the period for which he has accounts and what's it going to be for the current year?

We simply ported across for our new house/mortgage

Porting is simply transferring your existing rate to your new mortgage. It doesn't confer any rights or guarantees and that new mortgage is subject to status and the lender's current criteria as you are finding out.

When you completed your formal/full mortgage application, did you clearly state your husband's trading period? If you were expecting to exchange next week when did you actually apply to them? How long has the processing been going on?

muffin07

Kingstreet - I see you are a mortgage advisor and thanks for trying to help. In answer to your q's - I can't recall what the loan to value was when we purchased years ago but approx 60%, for the new house it's 69%.

As for my husbands net profits, I don't have to figures but Chelsea have reassured us (not that it's much help right now!) that once the 3 years accounts are complete, we can have a mortgage over 40k more than we need!

Yes they had all details of when he set up his business and all was going along just fine - we applied about 4 weeks ago and it's only in the last 10 days that they have asked for a projection figure etc but my husband's accountant can't legally provide the final months account and then change it to factual at the end of next month. The accountant has provided a reference stating all figures etc and they said this would suffice, but now the "system" can't be cut through apprantly and the underwriters whom were trying for this, have said the same. We will find out today if we are accepted for a mortgage elsewhere and if not then we can only hope that Chelsea can do something about their "system"..... failing all that, I assume it's speaking to another advisor but independant, or wait a further 6-8 weeks and pray our buyer and seller will do the same, but that wait isn't good on us for personal reasons.

Do you happen to know what we could do in respect of Chelsea? Is there anyway around it?
Thanks for your help, much appreciated.