Refused Nationwide Home Improvement Loan

evh22

Good Morning All,

Some advice would be great if you can assist please.......

My wife and I hold a Nationwide mortgage on the base rate tracker, paying around 2.5% on an outstanding mortgage of £142000 over 27yrs.

We intended to replace our kitchen which involves us knocking through the internal diningroom/kitchen wall to make a bigger space. This involves structural work as the wall is a supporting one.

I went to my local Nationwide branch for some figures on a homeowner loan. Our house was valued at £188000 on their system - but the advisor stated that because we wanted to complete structural work on the house a new valuation would be required (the last valuation was done about 4yrs ago). I was hesitant because I knew our new valuation would be less than the original one AND we would be charged an upfront non-returnable £99 admin fee for looking into this application.

Despite me raising my concerns with the advisor I was told not to worry as the valuation was unlikely to fall below the required loan to value figure. I went ahead and paid the £99.

Sure enough - valuation has come back at £170000 and Nationwide are saying they will not lend us any money. I feel like this is a scam and an easy way for Nationwide to make money out of customers.
1) Can I get my £99 back?
2) Is it likely I can borrow money at a different rate over approx 20-27yrs?
3) Any other suggestions!

The reason for looking at borrowing this way is to give us time to settle some existing debt (all manageable by the way) - with a view to overpaying the home owner loan in 2-3 yrs and reducing its overall term.

Sorry its a long post - but this is concerning me hugely.

Many Thanks

keith1950

Hi, as you say, you had concerns over this situation before went ahead.

If the house was going to be security for the loan then they would insist on a new valuation.

Your loan to value ratio has fallen since your original mortgage application to the point where, in the current situation,if you were applying for the same mortgage now you might not be successfull anyway.

I would raise your concerns with the branch manager as the advisor does not appear to have paid enough attention to the figures and as such has wasted you £99.

CLAPTON

how much were you asking for
how much are your 'manageable ' debts

iolanthe07

Another thing that might be a concern is the huge mortgage you have at a very low interest rate. That's fine for now, but most people seem to think that rates will rise in the not too distant future. If the tracker rate went up to, say, 5% (by no means inconceivable and a lot less than it has been in the past), then you might find repayment very difficult. I don't think that bank are necessarily scamming you, just being cautious in what is a very uncertain world, financially.

opinions4u

I was hesitant because I knew our new valuation would be less than the original one AND we would be charged an upfront non-returnable £99 admin fee for looking into this application.

Despite me raising my concerns with the advisor I was told not to worry as the valuation was unlikely to fall below the required loan to value figure. I went ahead and paid the £99.

You knew the risk of down valuaton. You paid the £99. It down valued. While you can ask for a refund of the fee you knew was non-refundable, I can't see that you have a leg to stand on.

somethingcorporate

Do you think Nationwide would make more money from you by charging you a one off fee of £99 or by lending £x k over many years?

You took the risk of being down-valued and it was. Hardly rocket science and I don't think there is any case for you to get your money back.

immoral_angeluk

Considering the current state of the market, I think they should be doing new valuations on ALL secured loans.
Think of it from the lender's perspective. We're in a really tough economy and they're having to be very cautious with their lending.

ashleypride

It's a scam, you have been mis-sold yada yada yawn.

KingElvis

I would demand satisfaction, a duel...they are cads sir, and bounders.....damn their eyes

evh22

Thank you for the replies. They are valid points, I s'pose i'm just a bit fed up about paying £99 for nowt really.....

[Deleted User]

evh22 wrote: »

Thank you for the replies. They are valid points, I s'pose i'm just a bit fed up about paying £99 for nowt really.....

but it wasnt for "nowt"was it?at least you now know an upto date valuation of your property,perhaps thats whats peed you off?