Moving, new mortgage declined...

ymmit

Supposed to exchange contracts tomorrow, new mortgage declined by Santander.

In a 4 yr old house, owing about 110k to Santander who I have been with for 6 mths.

Got a cracking part ex deal on a new house, bigger, better, just around the corner from where I am now.

Meet all the leding criteria, everything going as expected however they have just baulked because there is a defaulted credit card from 2007 (which I had paid in full as soon as it was brought to my attention by the lender).

Irony? Nothing on my credit score has changed, at all, since taking this current mortgage with Santander.

Salt in wound? If I go anywhere else I'll get stung with an ERC by the bank that won't loan us the money.

They won't entertain an appeal as they say the default means I fall outside of their current lending criteria. Do I have any grounds to calim that is unfair, or that the ERC is now only being charged due to a change in terms?

And if I go elsewhere, who is likely to be able to complete on a mortgage in 3 weeks!!!

All help welcome!

The_J

Can you get the default removed from your credit file (it will require the lender in question to remove it)?

Santander wouldn't have cared about it in the past but these days they are very picky about credit score. You might be able to find something elsewhere but the ERC will be savage.

Thrugelmir

ymmit wrote: »

They won't entertain an appeal as they say the default means I fall outside of their current lending criteria. Do I have any grounds to calim that is unfair, or that the ERC is now only being charged due to a change in terms?

No change in terms. I've highlighted the relevant part. The world is a financially different place since the events of 2008. Banks therefore have returned to their pre boom days of prudence.

Either pay the ERC or stay put where you are.

Did you forget that you had a credit card debt? A default is a very foolish thing to let happen. As now you are paying the price. Until such time as it drops off your credit record.

Joe_Bloggs

Santander's current lending disapproval reveals a hypocrisy that relates to their past lending criteria when it comes to present remortgages. I suppose it is down to lack of competition.and a desire for profit . Are the lenders so arrogant because they know they do not face any competition.
J_B.

Wh05apk

Abbey have completely changed in the last 6 months, I used to give them 2/3 of my business as their rates were good, and their service was superb, however now they are an absolute pain, their criteria is very strict with regards to adverse, and they need confirmation over every petty point.

Unfortunately you have been caught out by a change in their criteria, with regards to porting, it will state, subject to meeting criteria at the time of application.

Dave_Ham

Totally agree with above. Abbey knew they had historic toxic debt, liquidity issues and high % interest only lending late last year.

Typically they used to overlook previous long term adverse 2 years + if there was decent, current credit lines and low utilisation of credit available.

They changed their policy wholesale and it effected the market, not only that it was the catalyst for the other lenders to see a major player effectively withdraw from the market. They reduced interest only lending and increased rates.

As I am sure you are now aware, unfortunately you have the 2 options you mentioned. Take the ERC on the chin, or stay where you are.

There will be no other recourse with Abbey, unless you can somehow get the default removed (as J said)

Good luck

RavingMad

Can I ask if you've had a mortgage offer from Santander? Just wondering how you've got to the stage of exchanging contracts and then getting declined on the mortgage?

Slightly intrigued as we're due to exchange soon (hopefully) and wouldn't want to encounter the same problem that you're facing

Thrugelmir

Joe_Bloggs wrote: »

Santander's current lending disapproval reveals a hypocrisy that relates to their past lending criteria when it comes to present remortgages. I suppose it is down to lack of competition.and a desire for profit . Are the lenders so arrogant because they know they do not face any competition.
J_B.

No. Its because they wish to lend less. Therefore can filter away the risks they have no wish to underwrite. Plain straightforward banking.

You talk in terms of people having an entitlement to a mortgage, which is not the case.

property.advert

Is there anyone alive who applies for a mortgage without pulling the very latest versions of their credit files from all available agencies ?

Didn't think the dodo was still doing the rounds.

Harsh ? perhaps but seriously, if you haven't been in a coma since 2008 you know you have to do this and if you haven't, it means you just couldn't be bothered.

property.advert

Thrugelmir wrote: »

.... You talk in terms of people having an entitlement to a mortgage, which is not the case.

Quite true !

And these would be sub prime borrowers would do well to remember just where their mortgage money comes from - prudent folk who save up their hard earned.

The_J

property.advert wrote: »

Is there anyone alive who applies for a mortgage without pulling the very latest versions of their credit files from all available agencies ?

Didn't think the dodo was still doing the rounds.

Harsh ? perhaps but seriously, if you haven't been in a coma since 2008 you know you have to do this and if you haven't, it means you just couldn't be bothered.

But he knew he had a default and Santander knew he had a default when he took the mortgage out? Since his credit from when he took the mortgage has been perfect I think it is perfectly rational to expect Santander to be fine with the situation because, if he does !!!! all and stays in his house, they still have a debt with him.