bank about to turn me down because deposit origins

debjen36

I have recently been approved for a mortgage with a well known Spanish bank.I am married but applied on my own as my hubby has a dodgy credit history. We have a large deposit in a joint account, money obtained through savings and inheritance to my husband. I was clear from the start of the process about where the money was, where it'd come from and my husband's credit. The sale was going through (offer excepted, solicitor appointed, valuation by the bank done),etc, until this week when I discovered that the head office of said bank want my husband on the mortgage and will not proceed. Cannot speak to anyone at head office to resolve this, have to go through branch advisor who is away until tues.
Can they do this? Any advise would be gratefully received.

poppy10_2

debjen36 wrote: »

Can they do this?

Yes .

Cazza

Yes, they can.

As your husband is going to be living in the property after completion, the bank will ask him to sign a deed waiving his rights to live in the property if they ever have to repossess.

The catch comes because he is funding the deposit; legally, this gives him an increased "interest" in the property. If the bank tried to repossess and he didn't want to leave (despite signing the form), it is likely that if he went to court, they would find in his favour and not force him to leave. The bank would therefore not have vacant possession and would not be able to sell the property.

Did your solicitor or mortgage adviser know where the deposit was coming from? They should have warned you of this before the application went in. Talk to the solicitor and mortgage adviser, they are best placed to help you find a way round this which fits with your circumstances. It's a situation which doesn't come up very often (I only had one case like this in my 9 years in the industry).

Good luck - I really do feel for you finding this out at the beginning of the long weekend! X

debjen36

Hi, and thank you, yes both the mortgage adviser and solicitor knew the situation. Is there any way around it in your opinion? He has signed a letter stating he is giving the money to me and this still wasn't enough. X

Cazza

No, sadly the letter won't be enough; if he went to Court they would just find that his interest in the property (level of deposit plus living there) is just too significant to set aside in favour of the bank.

There is no way the bank will allow your husband to provide the deposit, live in the house and not be on the mortgage. When I had clients in a similar situation, they approached family, who gave them the deposit instead. Later, after completion, they repaid their family with the money that would have otherwise been used as the deposit.

BUT..... talk to your solicitors. My client's solicitor insisted on a very clear paper trail that this had actually happen, not quietly giving the money to the family so it could be given back again etc. Your solicitor and mortgage adviser will be able to tell you the best way to tackle it as they will know your personal circumstances.

Pritchett2003

Probably pointless question to ask here but here goes, can't you just not tell them he was going to be living at the property? If the mortgage goes through and then a few months down the line you get back together what can the bank do then? Or is this a bit too dodgy? Lol really not trying to sound too del boy about this! Just I am in similar situation except its my parents that are giving me deposit mortgage will be in my name but they will be living with me I didn't think I would have to declare that they would be living in the same house.

mjdh1957

If you lie to obtain a mortgage then that is fraud and a criminal offence.

Do you want to take the risk of being found out? I wouldn't.

poppy10_2

Pritchett2003 wrote: »

can't you just not tell them he was going to be living at the property? If the mortgage goes through and then a few months down the line you get back together what can the bank do then? Or is this a bit too dodgy?

Not 'dodgy'. It's fraud.

Pritchett2003

Oops my bad, apologies ;-)

Slinky

If the only reason you're not putting your husband on the mortgage is because of his dodgy credit history, but your mortgage company are happy to have him on the mortgage because of the deposit, where is the problem?

steve1980

I'm assuming the well known Spanish bank is Santander?