Woolwich Mortgage Supplementary Conditions

mna8

HI,

I have recently received a Woolwich mortgage offer through the post and I am confused by the supplementary mortgage conditions section:

“You must repay the following commitments in full within 30 days of completion of this mortgage without taking on further borrowing:” Then they mentioned my personal loan amount.

No where in the mortgage offer they point towards these supplementary conditions or referening to it. I'm never been late on any payments or on my existing mortgages. Can someone share their expereince what they can do if by end of 30 days I wont able to pay that amount? or they will contact me and give me some time or send me some warning letter. Please share your experience.
Please reply asap because I don't go ahead if this is an issue later on.

Gary123456790

It seems fairly clear, they will give you the mortgage but only on the basis that you pay off your personal loan.

I would have thought you'd be aware of this already - did you go direct or was it through a broker?

Gary.

Wh05apk

Is sounds like to make the application fit, somebody had to say the loan would be repaid!

Technically if you do not repay it within the 30 days, you will be in breach of their terms and conditions, with all that entails, however I have never known a lender to check up on this, which is probably why someone thought saying it would be repaid would not be an issue.

mna8

Thanks, alot for the response. If it is a breach of term and condition what they can do? Do they give me more time say a week or two to pay or just start the process of repos.

jamesd

If you are willing to accept the terms of their offer, do that. If you aren't, don't. You should assume that the solicitor acting on their behalf for conveyancing will ask you for proof of availability of funds to comply and that the mortgage funds will not be made available if you can't prove it.

Then there's the simple ethics and law of not knowingly entering into a contract where you intend from the outset not to honour its terms.

mrchiggles

Seems to be something Barclays are starting to do more and more. We took a large personal loan to build an extension which we were going to pay off with excess on the mortgage, they flagged to us in the offer that it needed to be repaid (which of course it has been).

jamesperrett

mrchiggles wrote: »

Seems to be something Barclays are starting to do more and more.

We had a similar condition when we took out a Woolwich mortgage in 2007 so they've been doing this for a few years now.

James.

mmfarhan

I have also got mortgage offer from woolwich yesterday and they have told me to pay off outstanding amount on my barclays credit card although i have some outstanding amounts on my other credit card as well (which is even more than the barclays card).

Are they checking barclay credit card only?
What will happen If I transfer the amount to some other credit card?

Farhan.

Goldiegirl

Generally conditions asking for the repayment of credit commitments are due to affordibility issues.

In their opinion, you can't afford the mortgage and the credit commitment. So if you simply transfer the debt to another credit card, the debt will still be in existance - you won't have cleared the debt.

The reality is, that they probably won't check after completion to see if the debts are cleared.

But, if at some time in the future you apply to them for further lending, e.g. for home improvements, it's likely they'd look into your credit situation. If they noticed that you didn't clear any credit commitments that were a condition of the mortgage they'd take a dim view of it, and most likely decline your further advance.

ValHaller

mmfarhan wrote: »

I have also got mortgage offer from woolwich yesterday and they have told me to pay off outstanding amount on my barclays credit card although i have some outstanding amounts on my other credit card as well (which is even more than the barclays card).

Woolwich and Barclays being one and the same, they want to be sure that all your credit with them is secured and leave other companies with your secured debt. Puts them at the front of the queue if you go financially delinquent.

As they are the same group, the repayment is likely to be checked, I would say.