Post Office mortgage BEWARE

irwellgirl

Last week we applied for a mortgage using the Post Office's online system - this came back with an Approval in Principle (AIP) for a loan of £240K. On the basis of this 'approval' we had an offer accepted on a property, secured the services of a Solicitor and paid for the survey.

Yesterday, we progressed the AIP to full application and received a phone call this morning from the Post Office saying that they would only loan £203K - not enough to buy the property!

Nothing has changed in terms of the data we entered into their online system...and they haven't even asked for payslips etc supporting the application - JUST CHANGED THE GOALPOSTS.

It's no wonder the housing market is on its knees when lenders can do this - has anybody else come across this before? (I'd be interested to know if this is all lenders or just the Post Office.)

samtoby

An AIP is not an offer. You could for example achieve a mortgage in pricipal for 100K but when further checks are done on your credit report for example then this could reduce the amount.

They are lending the money so they can move the goalposts I guess.

steveott

Surely if they value the house lower than 240K they will not lend you 240K just because thats what you offered?

I have nothing but great things to say about the PO. Application to offer within 3 weeks even though my solicitor wasnt on their panel. Good comms the whole way and would recommend to all.

Good 5 year fix deal at 3.59 too.

The_J

I would hope the OP is not that stupid steve to think they can borrow more than the LTV limit.

An AIP is no guarantee but it should reflect what they are intending to lend, a full application should just be an extension of the AIP. Was there any undisclosed credit or material change to information?

maninthestreet

Assuming the survey has been carried out, what value did it state the property was worth?

irwellgirl

nothing in the figures we provided has changed and we both have good credit ratings- already have a mortgage and a decent sized deposit to put down-
and no the house hadn't been surveyed yet so nothing to do with the house valuation- really frustrating!

Debt_Free_Chick

Possibly, with a Euro meltdown looking more likely (Spanish Banks), lenders are now being cautious ...? Dunno, just guessing

The_J

No, criteria hasn't changed.

There will be an obvious explanation, can you post a breakdown of your income/commitments etc.?

DannyboyMidlands

Reduce your offer. PO may have saved you a tidy sum.

The_J

DannyboyMidlands wrote: »

Reduce your offer. PO may have saved you a tidy sum.

"You know that offer you accepted Mr Vendor. Well I'm now reducing it by £37,000. That's obviously OK with you yes?"

"Err no"

irwellgirl

hoping panic might be over- had an loan which was paid off in full less than 2 months ago- it was still showing as 'active'- as long as we can show its now paid off we should :jbe ok- thanks for all replies anyway