Anybody taken HSBC mortgage recently?

bigriggers

Hi guys,

I've just got off the phone to HSBC trying to get an agreement in principle, however they only offered around 1.8x our joint salary.
Income is just over £53k, and they offered us £98k! Even the women said it seems very low, and she went off to check she'd put all the figures in correctly.

We are first time buyers and looking to spend around £140k on a house, with a 10% deposit. We have good credit ratings and only a couple of grand on credit cards, no loans. A few months ago Halifax gave us an agreement in principle for £210k on our wages (although the sale unfortunately fell through)!

The women on the phone said we could still put offers on houses and when we actually apply for the mortgage it may go through, but I want something in place to be honest. I wouldn't mind so much but I couldn't find a deal as good as this one, 4.69% fixed for two years with 90% LTV. A "whole of market" mortgage advisor could only get us 5.39%, which is a fair old difference per month!

bigriggers

Actually, just noticed the post office are doing 2yr fixed for 4.59% - let's see what they'll offer us!

kingstreet

Whole market probably means selecting from commission-paying deals only. An independent mortgage broker would agree a fee with you for his advice, and consider all deals, including those only available by going direct to lender.

There are two year fixed rates lower than the HSBC one you describe. Others match the rate and have lower fees or a cashback option.

I can't tell you what you might be able to borrow as I haven't completed a full affordability check with you.

Try an independent broker near you, or ask friends or relatives for a recommendation.

Lokolo

kingstreet wrote: »

Whole market probably means selecting from commission-paying deals only. An independent mortgage broker would agree a fee with you for his advice, and consider all deals, including those only available by going direct to lender.

There are two year fixed rates lower than the HSBC one you describe. Others match the rate and have lower fees or a cashback option.

I can't tell you what you might be able to borrow as I haven't completed a full affordability check with you.

Try an independent broker near you, or ask friends or relatives for a recommendation.

Can they guarantee it will be cheaper?

Example, PO have very good fixed rates at the moment. Now unless an IMA can guarantee they'll get me a better deal, surely it's a waste of time?

betmunch

An Independent Mortgage Advisor will include all products including the non commission paying ones as stated above.

If you have already found the best deal on the market it cant be beaten. Do you know you have the best available to you? If you KNOW you have then there is no need to see an advisor, if you MIGHT have, or THINK you have then there is merit in seeing an Advisor.

Also, what do you consider the cheapest?
- The lowest interest rate?
- The lowest total cost over the product period?
- The lowest total cost over the term of the mortgage?

GMS

bigriggers wrote: »

Actually, just noticed the post office are doing 2yr fixed for 4.59% - let's see what they'll offer us!

Look deeper than rate alone.

4.59% with a £995 arrangement fee and £240 valuation fee.

Could a 4.89% mortgage be a better overall deal? First thought is no but with £0 arrangement fee and £265 valuation fee there is a saving of £970 in fees.

Payment difference £22 approx per month more. £500 over 2 years so a saving of £470.

May be deals with cashback and free valuations too.

Look beyond rate

bigriggers

Well we've been declined for a Post Office agreement in principle too!
At least I've found out why this time....credit score.

I've just checked my score, it's 371 "fair", I've missed a couple of payments on credit cards for stupid reasons (like transferring a balance to a 0% card, but forgetting to pay next month's interest from the cleared card!), but can't believe its changed that much in a few months - as per my original post, we were offered a mortgage in August!

Any idea how many months of "on time payments" it will take for my score to improve enough to get a mortgage?

Lokolo

betmunch wrote: »

An Independent Mortgage Advisor will include all products including the non commission paying ones as stated above.

If you have already found the best deal on the market it cant be beaten. Do you know you have the best available to you? If you KNOW you have then there is no need to see an advisor, if you MIGHT have, or THINK you have then there is merit in seeing an Advisor.

Also, what do you consider the cheapest?
- The lowest interest rate?
- The lowest total cost over the product period?
- The lowest total cost over the term of the mortgage?

Thanks. That's the bit I worry about. I could go and say "Well I can get this already, do your magic." I come out with the same mortgage (as they couldn't beat it) but having to pay the IMA a fee for their services, so I lose out.

Hence the "I kinda want a guarantee." point.

---

Sorry for hijacking your thread OP, good luck finding a mortgage.

kingstreet

Lokolo wrote: »

Can they guarantee it will be cheaper?

Example, PO have very good fixed rates at the moment. Now unless an IMA can guarantee they'll get me a better deal, surely it's a waste of time?

Here's a comparison I made back in June. The rates are out of date, but the principle still applies.

In some cases, using an independent broker may be preferable to a whole market adviser.

Whole market advisers may only select from lenders and products which pay them a commission, while an independent may agree a fee with you and pay to you any commission he receives. If a direct to lender product is better for you, the independent will tell you if that is better as you are paying a fee for the advice.

Here's an example;-

You see a whole market broker looking for a 25 year repayment £150k mortgage on a £200k purchase. You want the best five year fix, regardless of fees. You agree the broker will take commission on any arranged mortgage.

He finds you an Accord Mortgages product at 4.44% fixed until 31/08/2016 at £828.65 per month. The broker will receive commission of £487.50.

You then see an independent broker who agrees to charge you a fee of £299 and to pay you any commission he receives on any arranged mortgage. He also looks at direct to lender deals and explains that in this case, you may get the best deal, but no commission rebate.

He finds you the Accord option, but as you have a fee agreement, he tells you the commission rebate would be £487.50, leaving you £188 better off.

The best overall deal is Yorkshire Building Society's 3.99% fix until 30/09/2016. The monthly payment is £790.93. This is a direct to lender product, so no commission rebate. You've paid a £299 fee, but in doing so, the monthly cost of your mortgage has fallen by £37.72 against the Accord option, saving you £2,263 over the five year fixed term.

I'm sure someone will point out that you can save £299 by finding the best direct deals yourself and that is true. If you have the time and inclination to do that, why bother with a broker at all?

There are borrowers capable of finding their own way to the best deal for them. As long as they compare fees, penalties, follow-on rate, terms for possible consent to let and all the other terms and conditions they might fall foul of, they should be fine.

If you want someone to do it for you and to provide written advice and recommendation backed by professional indemnity cover and financial services complaint and compensation facilities you need to know the difference between whole market and independent.

pinkteapot

bigriggers wrote: »

Well we've been declined for a Post Office agreement in principle too!
At least I've found out why this time....credit score.

I've just checked my score, it's 371 "fair", I've missed a couple of payments on credit cards for stupid reasons (like transferring a balance to a 0% card, but forgetting to pay next month's interest from the cleared card!), but can't believe its changed that much in a few months - as per my original post, we were offered a mortgage in August!

Any idea how many months of "on time payments" it will take for my score to improve enough to get a mortgage?

The credit score could be causing the problem at HSBC, who are known for being picky with their mortgage customers. Quite a lot of stories on the boards of people who have been turned down for HSBC mortgages.

kingstreet

I read an article a couple of days ago about PO not being prepared to release number of 90% applicants turned down in response to a suggestion they were declining the bulk of them. I'll see if I can find it.

http://www.thisismoney.co.uk/money/mortgageshome/article-2066566/Post-Office-lenders-accused-window-dressing-90-mortgages.html?ito=feeds-newsxml

There it is.