HSBC - heard so much bad about them, since submitting app. Any positive experiences??

kloana

Hello everybody,

I've mostly come on here for a bit of a whine and a public panic. But hear me out.

We (self and partner, FTBs) have made a full application, following generous DIP, to HSBC for a £60,000 mortgage (82% LTV), which was received by their underwriters today. All of our paperwork/figures are kosher and accurate, and our income versus our (contractual) outgoings leave us with a £1,000 per month surplus, after proposed mortgage has been factored in. The mortgage in question has illustrative repayments of under £350 per month (a bit less than current rent). We take home £1,000 per month each.

We have good credit histories in the sense that we have long-term experience managing past cards, loans, etc., and have never missed any payments. We currently have just one debt between us, a personal loan with HSBC, costing £133 per month.

We've both banked with HSBC for 10 years. We have a joint account that has an overdraft we rarely use (in the past year, we've paid 19p debit interest, indicating how infrequent our usage has been).

So, we think we look decent enough on paper, have a proven track record with the bank, and the logical step seemed to be to apply to HSBC for our mortgage.

However, since making this step, we've been met with nothing but negativity from a lot of corners, namely our EA, solicitors, and just about anybody who's heard how 'bad' HSBC are (I know there are reasons for this negativity, due to their conveyancing quirks, but this problem has been eased now, and we do have a CQS accredited solicitor).

Aside from sour grapes over HSBC's cosiness with Countrywide Conveyancing, and all of their problems, I've also been informed by several sources that HSBC are 'very strict', and that approval is unlikely. One source (found when scouring the internet for specifically negative reviews - why do I do that to myself!!) claims that they only approve something like 30% of full applications.

Former conveyancing issues aside (which don't apply to us), why, oh wise MSE'ers, do HSBC have such a bad rep for being strict, and generally a poor reputation as a lender? Is there any truth in all this heaps of negativity about them? Does anyone have any positive experiences to report?

I understand that many knowledgeable people on here are indeed brokers (with whom HSBC don't deal), but what are our chances??

We're now eagerly awaiting a decision, and hope all our worry has been for nothing, but what should us novices do in the event of a decline? Get our backsides straight on down to a good broker??

Thrugelmir

Given you've banked for HSBC for a number of years. This will be a major plus. HSBC are merely a very conservative (small c) bank. Upholding a more traditional style of banking that other banks dispensed with some years ago, but are returning to. HSBC are the largest net new mortgage lender in the UK currently.

Personally I won't get stressed unnecessarily.

bylromarha

Telephone application 26 Sept, paperwork arrived 28 Sept. Showed required documentation in branch 29 Sept, approved application (subject to valuation) received 4 Oct. Valuation conducted 8 Oct.

Granted, this is a remortgage, but we don't bank with HSBC and feel things have moved swiftly so far.

kloana

Missed a call from HSBC yesterday - no voicemail, only knew it was HSBC (though no idea which department) because I recognised the number.

Called back their regular telephone banking line, "yes, HSBC called you, we don't know which dept., but it was NOT mortgages, as there are no notes on your account".

Called the mortgage line direct, "yes, it WAS the mortgage team, we don't know what for (no notes!), but we receieved your completed application form today. It was probably to acknowledge receipt of your documents".

Called the mortgage line direct again today, got put through to underwriter, "yes, it was ME, I called you yesterday, sorry no notes, I was about to leave...I was calling you to confirm that your application has been approved (subject to valuation)".

(phonecall from valuers a few hours later to confirm contact details for our EA - valuer bit brusqe/brief, but left me under the impression that valuation will take place this week).

So, was approved within literally a couple of hours of them receiving our documents? I'm stunned and, despite slapdash customer service, impressed so far.

Fingers crossed for a smooth ride!

Edit: I did ask (and double, tripled checked) why we were approved so quickly, to which the lady said something vague like "at HSBC, we do things differently, we could already see both salaries being paid into your account". Which I took to mean that their minds had already been made up, pending crossing the T's and dotting the I's.

Thrugelmir

kloana wrote: »

Edit: I did ask (and double, tripled checked) why we were approved so quickly, to which the lady said something vague like "at HSBC, we do things differently,

As I said in an earlier post. Banking with HSBC for 10 years is a major plus. You have a track record. Long standing relationships create trust.

**ThEChAllEnGeR**

I recently remortgaged through HSBC and didn't have a bank acc with them before. It was a 70% mortgage borrowing £87k. Between us we earn about £60k (although this has recently dropped due to my wife being on maternity leave) and have one dependent.

I was similarly worried about the bad press they'd received about acceptance rates and pulling out at the last minute, but I'm pleased to say it all went through well. A LOT of paper work and sending and resenting documents which was a hassle, but as long as you give yourself enough time (about 2 months) this should be ok. I went with them because of their highly competitive rate, which was head and shoulders above any other provider in terms of cheaper rates, no arrangement or legal fees and no early exit fees (ideal as I'm hoping to start overpaying a lot when my wife returns to work).

I initially asked London and country to scan the 'whole market' to find the best rate, and the best they could find was 3.45% and a £500 arrangement fee. The rate I got applying directly through HSBC was 3.19% with no arrangement or legal fees. When I brought this up with L&C they said they don't deal with HSCB because of their rejection rates. Hardly 'whole of market' then!

There is something very fishy about L&C's operation, and am tempted to report them to the FSA for false advertising. How on earth can they claim to be 'whole market' reviewers tasked with finding you the best rate when they exclude one of the country's largest banks!

**ThEChAllEnGeR**

I also found a lot of negative reviews online, but I think this is a result of people only reporting bad news.

A lot of the applicants also appeared to be going for large loan to values and loan to incomes. Something like "me and my partner earn £50k between us, and we've applied for a £220k, 90% mortgage. We have three dependants and £10k in debts". Then they are surprised when they get refused! Just because they aren't reckless lenders doesn't make them a bad lender.

I think that given you are borrowing a sensible amount, you should be ok!

Thrugelmir

**ThEChAllEnGeR** wrote: »

How on earth can they claim to be 'whole market' reviewers tasked with finding you the best rate when they exclude one of the country's largest banks!

HSBC only provide mortgages direct not through intermedaries.

kloana

**ThEChAllEnGeR** wrote: »

I also found a lot of negative reviews online, but I think this is a result of people only reporting bad news.

Yep, I think that's it, though I did run similar search strings for some of the other big banks and didn't find quite so much negativity! What Thrugelmir says, regarding conservatism is reassuring, though.

I think that given you are borrowing a sensible amount, you should be ok!

My latest panic/self-scaremongering relates to the upcoming valuation. Property is in good nick, has had a massive facelift, but we're paying within the very top band (74k) of what all houses in that street have sold for over the past 5 years, despite offering 10k less than original asking price. It is, however, an area of very diverse property types, ages, build-quality, and desirability. We can afford for it to be valued at around 66k, and still remain under (or, rather, at) 90% LTV.

Have googled the surveyors - Direct Valuations - and found terrible reviews

**ThEChAllEnGeR**

I also had a panic on regarding valuation, as we had spent quite a bit of money refurbishing the house, and had put in a valuation of £15k more than we'd paid for it just 2 years before.

We needed it to be no lower than the valuation we had put in in order to qualify for our 70% LYV. They sent a valuer out and accepted it that afternoon though, so I had a stress on for nothing!

kingstreet

**ThEChAllEnGeR** wrote: »

Hardly 'whole of market' then!

Frankly, the whole system of regulation is flawed. In practice, whole of market means products and lenders which accept business from intermediaries and which pay them a commission for the introduction.

A whole market adviser will never tell you about deals from HSBC, Co-Op/Britannia, YBS, Post Office etc. because they do neither.

Whole market is the FSA definition of such activity - not one intermediaries chose for themselves.

To get advice and recommendations on all mortgage products, you need to appoint an adviser to act on an independent basis. They charge you an agreed fee and in return find you the best deal. Any commission payable is refunded to subsidise the fee. The point here is that the intermediary is not selling a product with an aim of earning money, they have already been remunerated by you. This is an attempt at avoiding product bias.

What L&C does is perfectly acceptable, although suggesting they don't deal with HSBC because of "rejection rates" is inaccurate. They simply cannot deal with HSBC.