YBS Portable Mortage joke

David_Hutley

I now have a small bald patch from where I have been tearing out my hair whilst talking to the Yorkshire Building Society.

I am lucky enough to have an £800k house with a £175k tracker mortgage at 0.45% above base for the life of the mortgage. I was told that this was portable but depending on you meeting the criteria.

I have been looking at buying a smaller house ( kids gone ) and reducing the mortgage by £40k. I am self employed and have accounts showing an average earning of £45k over 3 years. My wife is not currently on the mortgage and is purely in my name.

It has taken me a month to get a decision and this has not been helped by YBS's insistence that Portability questions be dealt with by the local branch ( which in Portsmouths case is poorly staffed )

YBS insist that if I move ( Port ) the mortgage my wife would need to be added. Having to add my Wife does not seem fair but YBS insist that it is part of their current "Criteria". She is just in the process of setting up a new business and currently has no income and so was put down as a house wife ( very PC ).

YBS ran a credit check through experian ( I score 999 ) and spotted that I have a credit card in my name. The credit card is paid each month ( @£2500k ) by my business and I pay no interest. YBS are taking the maximum balance of this card as a personal liability. They have also included my wifes credit cards and loans for her business. They do not appear to understand that these costs are included in the gross profit of my business and not from the net profit or drawings.

I am being told that I do not fit the "Criteria" and am not eligible for a loan.
Now, are they being really awkward or really stupid.

By not accepting my request they are forcing me to either not move, and stay with a loan of £178k, Clear the mortgage all together, or go else where for a mortgage

Thoughts please

dunstonh

YBS ran a credit check through experian ( I score 999 ) and spotted that I have a credit card in my name.

Experian score is just a marketing thing from Experian. It doesnt mean a thing. There are plenty of people with 999 scores who have had their mortgage rejected. The lenders look at the data. Not the marketing score.

The credit card is paid each month ( @£2500k ) by my business and I pay no interest. YBS are taking the maximum balance of this card as a personal liability. They have also included my wifes credit cards and loans for her business. They do not appear to understand that these costs are included in the gross profit of my business and not from the net profit or drawings.

Sole traders carry the debt. Not the company. However, if it is cleared to zero each month, and you can show that, then they shouldnt be including it. If it is not cleared to zero then they should.

Portability is always subject to current lending criteria. So, you need to look at the areas where you breach or are pushing current lending criteria. Loan to valuation doesnt seem to be an issue. So, this really only leaves income. A £2500k card is 2.5 million. I dont think you mean that but if that is what they have input based on what you have told them, then it could be a reason.

David_Hutley

A £2500k card is 2.5 million. I dont think you mean that but if that is what they have input based on what you have told them, then it could be a reason.

You are correct, it's £2,500 not 2.5 Million.

My balance is never zero as with most credit cards. I am provided with the balance to pay each month and I pay in full. By the time the payment is made I will have spent more money on the card. I cannot believe I am alone in this !. If I am asked if I pay my credit card of each month I would say I do.

kingstreet

If you pay the full balance shown on your credit card statement each month YBS is being daft. I'd ask them to look at your last twelve months statements to evidence your repayment record.

As dunston has pointed out, if your businesses are unincorporated any debts fall to you and your wife as individuals to repay, so it is appropriate that the cost of these commitments be deducted from your income.

I guess the easiest way to see if YBS is being reasonable is to approach another lender and see what they offer. You may simply discover the more rigorous approach to affordability we see today is echoed everywhere.

David_Hutley

Portability is always subject to current lending criteria. So, you need to look at the areas where you breach or are pushing current lending criteria

Criteria appears to be something that YBS do not need to specify or justify. They could say that their criteria is that I earn £100k and do not have credit cards or that their criteria is that they no longer lend at all but would this be fair?.

I know things have changed and gone are the days of it being 3 1/2 times your income. I cannot see how I could be a safer bet, I am looking to borrow 21% of the value of a property and less money than I currently borrow.

Now it may be that YBS dont own the mortgage and so the current lending is not their problem. If the port the mortgage it would become their problem and cost them money. I this my problem ?

David_Hutley

I guess the easiest way to see if YBS is being reasonable is to approach another lender and see what they offer. You may simply discover the more rigorous approach to affordability we see today is echoed everywhere.

Yep, done this with Nat West and no problem at all. Do I want to give up on the 0.45% deal for the life of the mortgage.

kingstreet

David_Hutley wrote: »

Now it may be that YBS dont own the mortgage and so the current lending is not their problem. If the port the mortgage it would become their problem and cost them money. I this my problem ?

You an existing Chelsea borrower trying to fit into Yorkshire criteria?

There is/was a big difference between the two.

Income multiples haven't particularly reduced. You can still borrow around 4 x net profit after any credit commitments have been deducted and the number of dependents you have impacts your borrowing power more now. It's the attention to affordability and checking of the information on the application which has increased.

On your declared income, you'd normally expect to be able to borrow £180k with no credit and no dependents. On another case yesterday, we worked out (for example) Abbey was reducing maximum lending by 12% for three dependent children. That would see your maximum borrowing drop to £158k. A £300 per month ongoing credit commitment like a loan would reduce that by a further £14k, leaving £144k.

As I mentioned, see what other lenders would offer then you'll have a better angle on Yorkshire's approach.

kingstreet

Is YBS refusing to lend to you altogether, or is the reduced amount you're being offered insufficient?

Point noted re NatWest.

David_Hutley

You an existing Chelsea borrower trying to fit into Yorkshire criteria?

Nope, with YBS from the start. My wife has two boys who are now 18 and 21. The 21 year old is at home at the moment but works full time and his brother lives with his Dad and works.

I have tried going through this with YBS and they are all saying the same thing. I have had their final letter so I do not see what more I can do.

David_Hutley

Kingstreet,

Is YBS refusing to lend to you altogether, or is the reduced amount you're being offered insufficient?

Although they state in their letter that they are unable to accept the portability applications they later go on to say that after taking loans and credit cards into account they could lend a maximum of £36,186.

I have a loan for a bike at £175 a month for the next two years
My wife has a car loan of £287 and a business loan of £309 both 2 years to go. Her credit card balances ( maximum and cleared each month ) total £370 and then my credit card which I use for work at £2980.

At no point have they asked about assets, savings or other investments.

GMS

Have you asked them what would be the situation if there were no credit commitments?

Could you clear the credit with the mortgage, i.e port enough to cover everything then pay the difference between monthly payments if you had kept the loans and credit cards as an overpayment (product permitiing)

Not an ideal solution as you would be putting unsecured debdts on to your mortgage but may allow you to keep the product and rate. Interest rate much cheaper than you are paying unsecured but for much longer.

Do some sums and see what it comes out at.