HSBC rejection has made me paranoid - advice on Woolwich application please?

curiousftb

Hi all

I posted relatively recently on the HSBC mortgage shambles. As a frantically naive FTB I was hoping someone knowledgable might be kind enough to give me some guidance on the mortgage process? Situation is:

Salary: 45k (plus about that again in commission - which they aren't considering for this application)
Deposit: £47 k (made up of money from sale of bfs flat)
Property: 235k so borrowing 188k
Debt: £12500 (using 47% of available credit)
Credit score: 866 (Experian)
Never missed a single payment etc, just HSBC did five (FIVE) credit checks for AIP which they then agreed, only to reject me at application stage. This brought my score down from 928 in the last week! I hate HSBC...

So I went through the phone application with the Woolwich and they've sent me through the paperwork, which I've returned today. As a terrified newb (HSBC really knocked my confidence) I wonder if some of you sage and wise chappies who actually know about underwriting might be able to help me with some queries so that I can actually get some sleep?

1. I didn't get past the phone screening with HSBC but did with the Woolwich at formal application stage - which is good, correct? Or is this not really meaningful?
2. How likely is it that the underwriters will reject me once I'm with them? I realise that it's unlikely my underwriter will read this but what do you think the biggest objection might be?
3. Do most rejections happen at the underwriting stage or the phone application stage? I guess I'm looking for reassurance that as I've passed the phone screening, I'm over the biggest hurdle...?
4. Does anyone know if there's an appeal process if they reject me too?
5. Finally, much as I'd like to, I can't spend the next week sipping gin to relax myself, anyone got any ideas on how not to let the suspense drive you out of your mind?

Thank you!

Yours worriedly.

Dave_Ham

Do not try and overthink this, or it will drive you and gin bottle crazy.

Yes, there are people that fail at every step of the way but you tend to only see the bad news on here, as people are looking for help...

From the sounds of the information provided you should be fine and like I said on the last post; it was more reflective of HSBC lending policy rather than you as an applicant.

Woolwich are pretty flexible and would normally kick out early if they are not happy.

Take a breath and let things happen naturally rather than second guessing and driving yourself and those around you mad..

Fingers crossed..

GMS

Is this a single or joint application?

Woolwich require an amount of money left each month after mortgage and commitments.

If it is an application in your name only with the deposit from sale of somebody elses property then this could cause issues, especially if the donor is to reside. Was this mentioned by HSBC?

HSBC are probably the pickiest of lenders anyway so don't take the rejection personally.

Could you look at paying all or some of your debts from the deposit monies? Whilst possibly meaning higher rates it may well mean the difference between passing affordability and not.

handytips

HSBC are basically garbage and reject far more than they approve, thier solicitors panel is also a nightmare. Barclays are way behind at the moment. I would make a complaint with HSBC as to the amount of times they credit scored you. Get a good local broker involved they will be able to help you through this process, causing you little or no worry. Thats why the vast majority of mortgages are arranged by Intermediaries. Your story is a very common one at the moment.

Thrugelmir

curiousftb wrote: »

Debt: £12500 (using 47% of available credit)

This would register on the lenders credit scoring of you. Along with previous history of the debt.

Suggest you clear this debt first.

Turtle

handytips wrote: »

HSBC are basically garbage and reject far more than they approve, thier solicitors panel is also a nightmare. Barclays are way behind at the moment. I would make a complaint with HSBC as to the amount of times they credit scored you. Get a good local broker involved they will be able to help you through this process, causing you little or no worry. Thats why the vast majority of mortgages are arranged by Intermediaries. Your story is a very common one at the moment.

Hmm. Might that be why they didn't need bailing out? Because they're garbage? Or might it be because they are careful lenders? (Though I appreciate 5 credit scores is out of order).

curiousftb

Thank you all. Very curious as to the potential problem of the deposit coming from sale of my bfs flat - why is this? They did ask if he'd be living with me. He's a barrister so self-employed and too new to it to have enough receipts to be on the mortgage. Do you think this is something they might pick up on as an issue? If so, why would it be a problem?

You need nerves of steel for this house-buying lark, don't you! I'm really hoping that this goes ahead, I talked to Woolwich today and they said that although they probably have my papers, there's a backlog so the valuation is only likely to be done next week. So another nerve-wracking week to go through. Bring on the gin again...!

I really appreciate all of your advice by the way, it was calming to read!

Dave_Ham

I bet your boyfriend is signing up for extra work, just to stave off coming home.. (only kidding)

Seriously you have got to stop reading and trying to second guess what may or may not happen.

You are not planning the great train robbery and therefore always be honest from the start and you are not trying the great mortgage robbery.

You have perfectly suitable explanations for any questions and you would have been better off getting a broker now I think, as you could have dropped the worry at their door and just left them to it for you.

Woolwich are quite flexible and as said you have your sensible reasons, although you could put boyfriend on there with 0 income for ease...

At least the local off license is probably doing well before you move!!

Conrad

curiousftb wrote: »

Very curious as to the potential problem of the deposit coming from sale of my bfs flat - why is this? They did ask if he'd be living with me. He's a barrister so self-employed and too new to it to have enough receipts to be on the mortgage. Do you think this is something they might pick up on as an issue? If so, why would it be a problem?

The reason this may become an issue is he will be treated as an expense on your resources but his income will not be allowed for.

So it depends if your income can support him too.

Woolwich are a lender I dislike using as they employ call centres in India to progress broker cases and this leads to all sorts of delay and misunderstanding.

Whilst I do not wish to worry you, I like to give an honest undiluted view.

Having said this, if your application is presented well, you should get a mortgage.

curiousftb

Oh God, it's gotten even worse. I opened a joint account with HSBC with my boyfriend. I asked that some but not all of my direct debits be transferred. Despite my specific instructions (given both in person and over the phone), HSBC moved them all anyway which led to four payments bouncing, fees being incurred, the joint account going overdrawn more than once and my credit history being affected. They investigated and found that HSBC had indeed been at fault and transferred me £75 as compensation for the stress and trouble this caused me.

Long story short, when I checked my credit report today, my score had dropped from 903 points (good) to a staggeringly low 687 points (poor). :mad: This was as a result of the “payment missed” flag that HSBC put on my account. Today on the phone they have confirmed that this will be removed and that as of tomorrow, I should have a green “satisfactory” flag instead. But the Woolwich have just confirmed they got my papers today and have started processing my application. I've warned them about the situation and told them it should improve tomorrow but I'm so worried - what if they check me today anyway and reject me? Any advice? Could I appeal or something?:(

Dave_Ham

Try not to worry, you can always tell them the truth and they can re-score or manually check....

Do not think £75 cuts it for stress either...!