Skipton mortgages

Shinona

Hi all

Can I ask for an opinion on our situation please?

We sold our home last year and moved to a rental as we had a view to building our own house. For a number of reasons, we have put that plan to one side (too stressful mainly and not for us at the moment). Anyway, we have now found a house that we love. We have a 10% deposit (£21,500 - house price=£215k). The house was built about 3/4 years ago but has never been lived in. It was the show home but the builder has gone into administration and the administrators are selling it. There are only two properties in the development to be sold (the one we want and another exactly the same). We know that the houses were originally being sold for over £300k so we thought we had a decent bargain. But it seems that it will be classed as a new build because it hasn't been lived in.

We did a lot of research and found that Skipton had the best rate for a new build at 90% LTV. We have done our application and they have just refused it. They have stated that the reason is our level of unsecured debt which is sitting at about £40k. I know it is appalling and I am so angry with myself about it just now but we are where we are. With our salaries (£43k and £37k) SKipton have said that the mortgage is affordable for us but they will not lend.

Our own bank has offered us a loan which we would use to pay off £25k of the debt and my in laws have gifted us £7k which would be used to pay off credit cards too. We haven't arranged the loan yet as we didn't want it to impact on our mortgage application.

So, to my questions:
1. Is there anything else I can do to convince Skipton?
2. Is it worthwhile going to another lender? If so, who?
3. Will a broker be able to do anything for us? Is it worth it?

If we can't get a mortgage just now then it is not the end of the world but we do love this house and feel that it is one that will be our family home for the foreseeable future.

Any help at all would be much appreciated.

xx

betmunch

the 25K loan wont make a jot of difference as its still unsecured debt, your just changing the form its in. If you are not paying back your in laws then you can consider your unsecured debt 7K less.

You need to ask skipton if this will make the difference. My personal opinion (and I hope I'm wrong) is that they will still turn you down due to the high level of unsecured debt.

A broker may be able to find you a new lender to try, however I cant think of any off the top of my head. Admittedly I havent had a high LTV new build enquiry for a while now so there could be other options.

I think you will miss out on this house and would suggest payign down the unsecured debts as quick as possible and trying again when its a lot lower

Shinona

Thanks for your response. I have given them this information this morning and asked them to reconsider. I think I am frustrated because they agree that we can afford the mortgage as our situation currently stands. My point with the loan is that it will be a lower interest rate than we currently pay to the credit cards and so our outgoings will go down again if we put that in place. It also gives us a definite end date for paying it off.

I'm not sure it's going to make a difference to their decision either but got to be worth a try.

betmunch

Its definately worth a try, if you dont ask, you dont get!!!

at that loan to value they are taking a big risk so only want the creme de la creme of applicants, and there will be a lot of people like you but with less unsecured debt applying to them and only a limited amount of money to give out.

Sorry its not the news you want to hear

Dave_Ham

Hi there,

I use the Skipton and as Betmunch said, would be pleased for you but very surprised as they were incredibly selective with their old 95% LTV product and add new build into the equation and it muddies it further.

Then looking for another 90% LTV on a new build house, whilst I think I read right you are second time buyers makes a huge difference - to the point do Skipton know this? as most 90% LTV new builds are for first time buyers only I am afraid...

Without knowing everything, there will be another dream house as there always is. Therefore I would advise that you use half of your deposit to start clearing your debt and continue to overpay where possible. Put the gift in a separate home buying account until when it is needed and then find a non new build property to buy and go looking for a 95% LTV mortgage as clearly on good incomes you can afford it...

Just my opinion obviously...

Goodl uck whatever you decide to do..

ACG

Have you asked if they would accept the mortgage if it were £7k less?

If so then theres your answer. If not then you could try a broker to see what else if anything is out there otherwise its a case of just getting that debt down. Maybe ask them how much you would have to get it to before they would accept it. Atleast then you have a figure in mind of roughly where you need to get it to. But skipton are very strict on affordability, there is no discussions its either yes or no.

Shinona

Thank you all so much for your helpful responses and for not being judgemental about our situation. It has really helped today as I have been feeling very emotional about it all.

They are classing us as first time buyers as we haven't had a mortgage since last May.

They told us that they would want all of the unsecured debt to be gone before they would consider the application. They said they wouldn't consider a lesser mortgage as the unsecured debt is their concern. I have gone back to them and just waiting for them now.

Thrugelmir

Difficult to see any underwriter at a mainstream lender being willing to offer you a 90% mortgage with the amount of unsecured debt you have.

Suggest you stop dreaming, and pay a visit to the Debt Free Wannabe board. Channel you energies into getting your finances back under control.

MagicCats

Thrugelmir wrote: »

Difficult to see any underwriter at a mainstream lender being willing to offer you a 90% mortgage with the amount of unsecured debt you have.

Suggest you stop dreaming, and pay a visit to the Debt Free Wannabe board. Channel you energies into getting your finances back under control.

Normally I don't agree with Thrugelmir, but..... in this case it's a fair shout. You have a joint income of £80k and have debt of £40k? If that is correct 50% of your income is unsecured debt. That's your problem.

I'm not a 'debt is evil' type as I think some is unavoidable sometimes, but even by my moral and financial compass £40k is pushing it.

Have you seriously considered putting your energy into clearing the debt to a lower level? It can only help in opening up lenders to you, and I'm guessing you'd feel more secure taking on a mortgage with less unsecured debt to contend with.

Thrugelmir

MagicCats wrote: »

Normally I don't agree with Thrugelmir, but..... in this case it's a fair shout.

I merely express a "business" opinion not a personal one.