mortgage application disclosure

potatoefeet66

Thrugelmir wrote: »

You can waffle and conplain as much as you like.

None of this changes the fact that your current lender is under no obligation to offer you a new mortgage. That's the hard fact. You have no rights in this regard.

Furthermore, actually i do have rights and the facts are I've not given up after three and half years in seeing that my three children and I get them. AND had you had to fight for the rights and freedom and futures of your kids for any reason ( presuming you have them) you wold be doing exactly what I'm doing. and I'm not moaning about my mortgage its 0.84pc DER......

_Andy_

So given that you know everything about regulations, law, rights etc, what are you trying to gain by posting ad nauseum on this forum?

potatoefeet66

_Andy_ wrote: »

So given that you know everything about regulations, law, rights etc, what are you trying to gain by posting ad nauseum on this forum?

Im trying to inform the average mortgage holder of the machinations of a lender that there homes they hold dear and have worked for and future security may be destroyed. Lets face it who would have thought banks were capable of rate manipulation, so why stop there...... Lets call it a public service shall we.

ps I did not come on here for a civil slanging match I will not stoop to your level *** ( refer to your earlier post andy)

JimmyTheWig

potatoefeet66 wrote: »

Im trying to inform the average mortgage holder of the machinations of a lender that there homes they hold dear and have worked for and future security may be destroyed. Lets face it who would have thought banks were capable of rate manipulation, so why stop there...... Lets call it a public service shall we.

Sorry, I thought you were here for help.
Next time, save us all some bother and say in your first post that you are not looking for help but trying to help us.

_Andy_

Can we agree to let this thread die a death now?

bowlhead99

potatoefeet66 wrote: »

Im trying to inform the average mortgage holder of the machinations of a lender that there homes they hold dear and have worked for and future security may be destroyed.

This seems overly dramatic Allow me to sum up.

Several people explained, and you said you understood, that porting a mortgage to a different property is treated like a new application.

The only thing different about a ported mortgage is that they'll give you your existing product (interest rate etc) if you still qualify for the product (any LTV restrictions perhaps) AND they actually accept the new application. Whether they accept the new application is driven by a range of factors - the new house needs a valuation survey, the borrower needs to not have bad credit, proof of income to support the new loan balance and monthly payment amount, all that stuff.

You made an application at 138k, the highest loan amount allowed under the LTV restrictions, as you had an expectation it would be waved through because of your existing history with them. Unfortunately they weren't able to use that fasttrack process because you'd only ever given them a self-cert of your income, and a self-cert income wouldn't cut it with their current criteria when they know you are not a regular salaried person and your income needs to be proven. For context this was in early 2009 during/following the mssive credit crunch and financial markets were in free-fall.

They agreed, according to your post #20, your income was 15k. According to a later post, this was lower than the previous year, although it was better than some earlier year and it improved again later. But basically it was lower than the previous year and lower than whatever you certified at when first getting your mortgage. With markets tumbling and unemployment rising, a self-employed chap making 15k (declining from first application and declining from previous year cannot be expected to support a 138k mortgage (9x earnings), the FSA would have their balls. They said your application for 138k was not successful.

You suggested to them that you could pay more with your proceeds from sale of your house, dropping the loan requirement to perhaps 56k if you used up all your cash. If they were allowed to think purely from a greedy bank point of view, they might have bitten your hand off, because by you returning 82k of your outstanding balance they coul lend it out to someone at much higher rates than the loss-making <1% rate that you were on.

But they weren't trying to be greedy, screw society and get 82k of the loan paid off at all costs. They were judging the potential application against their responsible lending criteria. Still, a 56k loan for someone on a 15k income is not attractive, it's more than 3.5x income. The low interest rate might make it easier for you to service than the average person on a normal rate, but >3.5x for someone self-employed with a declining income in falling markets with tightening availability of credit is not attractive to them.

They would have had comments internally on the reason for the decline of the 138k. A new application for somewhere between 56k and 138k wasn't even put forward to underwriting as a formal application, because it didn't look like it would be successful against their strict criteria. Even though it would get them back over 80k of the low rate loan, they talked you out of putting in an application and said they did not want to lend that smaller figure to you.

Having told you this, they said you were welcome to go elsewhere as a new customer and try your luck. They also kindly wouldn't process an application decline which might hurt those chances. Or you were welcome to just stay in your existing house, as a 15k earner with over 138k borrowed from them at the lowest mortgage rate that had ever been seen in the UK market in the last 50 years, which would never be lent to a new customer with much higher salary let alone someone in your financial position..

Im trying to inform the average mortgage holder of the machinations of a lender that there homes they hold dear and have worked for and future security may be destroyed

On behalf of the average mortgage holder, we thank you for the information. We remain unconcerned about these sharp practices destroying our livelihood and the homes we hold dear.

losses 300k failed sale 575K loss on purchase based on post code detached value, 10 year mortgage term reduction 75K± 3years or more of stress and damages so yes we are talking of serious money. Our mortgages are not safe if lenders are allowed to alter regulated rules

£300k+ 575k+75k is £950 before the 3 years stress and all the damage they caused you. Sounds pretty serious shall we look at those components?
You lost 300k on a failed sale? You could still have sold. The lender did not say you couldn't sell and rent, or sell and buy somewhere really cheap. By not selling, and by staying in it with some more spent on extensions and refurbs etc, you said your property is now worth 460k.
- What is the lost 300k that you have suffered? Should they pay you 300k in compensation?

575k loss on purchase? You explained to us that you had an offer accepted on a house for 230k while the average detatched house goes for 575k. But the market thought that specific house was only worth 230k. How were you going to make it go up in value by 245k? Perhaps over the course of a few years you would spend 200k on it, then if property prices don't dip further like they have all over the country, it would be worth the market average of 575k and you'd have made 75k.
- What is the lost 575k that you have suffered? Should they pay you 575k in compensation?

Mortgage term reduction 75K? Is this the interest amount saved over 10 years due to reduced term? OK so you were looking at paying off 82k of loan which now won't attract any interest for the next 17 years: Compound interest at your 0.84% interest rate for 17 years is about 15% total. Multiply this by the 82k you could have paid off, you get to around 12k saved interest. So if you moved to a cheap house you could have a smaller loan and smaller interest. This is not news to anyone and the mortgage company did not stop you selling your old house for 300k, paying off most of the mortgage and getting a cheap place with a zero or small mortgage. Only your inability to have a new mortgage of 56k-138k, due to your low income, meant that this one specific house couldn't be bought.
- What is the lost 75k that you have suffered? Should they pay you 75k in compensation?

Your loss is zero. The risk of the average mortgage holder being put out of their own homes or people who meet all the criteria for a ported mortgage being denied is low.

The thread was entertaining while it lasted. I just wasted 20mins of my life summing it up. I demand 950k of compensation. I hope the ombudsman does not take 3 years to investigate as I need it to buy a house for 950k in an area where all the houses are worth 1500k. Hopefully if he messes me about he'll compensate me for the full 1500k. I hope the people who this ultimately costs in terms of taxes or more expensive financial services will understand.
:beer:

Wutang_2

bowlhead99 wrote: »

This seems overly dramatic Allow me to sum up.

Several people explained, and you said you understood, that porting a mortgage to a different property is treated like a new application.

The only thing different about a ported mortgage is that they'll give you your existing product (interest rate etc) if you still qualify for the product (any LTV restrictions perhaps) AND they actually accept the new application. Whether they accept the new application is driven by a range of factors - the new house needs a valuation survey, the borrower needs to not have bad credit, proof of income to support the new loan balance and monthly payment amount, all that stuff.

You made an application at 138k, the highest loan amount allowed under the LTV restrictions, as you had an expectation it would be waved through because of your existing history with them. Unfortunately they weren't able to use that fasttrack process because you'd only ever given them a self-cert of your income, and a self-cert income wouldn't cut it with their current criteria when they know you are not a regular salaried person and your income needs to be proven. For context this was in early 2009 during/following the mssive credit crunch and financial markets were in free-fall.

They agreed, according to your post #20, your income was 15k. According to a later post, this was lower than the previous year, although it was better than some earlier year and it improved again later. But basically it was lower than the previous year and lower than whatever you certified at when first getting your mortgage. With markets tumbling and unemployment rising, a self-employed chap making 15k (declining from first application and declining from previous year cannot be expected to support a 138k mortgage (9x earnings), the FSA would have their balls. They said your application for 138k was not successful.

You suggested to them that you could pay more with your proceeds from sale of your house, dropping the loan requirement to perhaps 56k if you used up all your cash. If they were allowed to think purely from a greedy bank point of view, they might have bitten your hand off, because by you returning 82k of your outstanding balance they coul lend it out to someone at much higher rates than the loss-making <1% rate that you were on.

But they weren't trying to be greedy, screw society and get 82k of the loan paid off at all costs. They were judging the potential application against their responsible lending criteria. Still, a 56k loan for someone on a 15k income is not attractive, it's more than 3.5x income. The low interest rate might make it easier for you to service than the average person on a normal rate, but >3.5x for someone self-employed with a declining income in falling markets with tightening availability of credit is not attractive to them.

They would have had comments internally on the reason for the decline of the 138k. A new application for somewhere between 56k and 138k wasn't even put forward to underwriting as a formal application, because it didn't look like it would be successful against their strict criteria. Even though it would get them back over 80k of the low rate loan, they talked you out of putting in an application and said they did not want to lend that smaller figure to you.

Having told you this, they said you were welcome to go elsewhere as a new customer and try your luck. They also kindly wouldn't process an application decline which might hurt those chances. Or you were welcome to just stay in your existing house, as a 15k earner with over 138k borrowed from them at the lowest mortgage rate that had ever been seen in the UK market in the last 50 years, which would never be lent to a new customer with much higher salary let alone someone in your financial position..

On behalf of the average mortgage holder, we thank you for the information. We remain unconcerned about these sharp practices destroying our livelihood and the homes we hold dear.

£300k+ 575k+75k is £950 before the 3 years stress and all the damage they caused you. Sounds pretty serious shall we look at those components?
You lost 300k on a failed sale? You could still have sold. The lender did not say you couldn't sell and rent, or sell and buy somewhere really cheap. By not selling, and by staying in it with some more spent on extensions and refurbs etc, you said your property is now worth 460k.
- What is the lost 300k that you have suffered? Should they pay you 300k in compensation?

575k loss on purchase? You explained to us that you had an offer accepted on a house for 230k while the average detatched house goes for 575k. But the market thought that specific house was only worth 230k. How were you going to make it go up in value by 245k? Perhaps over the course of a few years you would spend 200k on it, then if property prices don't dip further like they have all over the country, it would be worth the market average of 575k and you'd have made 75k.
- What is the lost 575k that you have suffered? Should they pay you 575k in compensation?

Mortgage term reduction 75K? Is this the interest amount saved over 10 years due to reduced term? OK so you were looking at paying off 82k of loan which now won't attract any interest for the next 17 years: Compound interest at your 0.84% interest rate for 17 years is about 15% total. Multiply this by the 82k you could have paid off, you get to around 12k saved interest. So if you moved to a cheap house you could have a smaller loan and smaller interest. This is not news to anyone and the mortgage company did not stop you selling your old house for 300k, paying off most of the mortgage and getting a cheap place with a zero or small mortgage. Only your inability to have a new mortgage of 56k-138k, due to your low income, meant that this one specific house couldn't be bought.
- What is the lost 75k that you have suffered? Should they pay you 75k in compensation?

Your loss is zero. The risk of the average mortgage holder being put out of their own homes or people who meet all the criteria for a ported mortgage being denied is low.

The thread was entertaining while it lasted. I just wasted 20mins of my life summing it up. I demand 950k of compensation. I hope the ombudsman does not take 3 years to investigate as I need it to buy a house for 950k in an area where all the houses are worth 1500k. Hopefully if he messes me about he'll compensate me for the full 1500k. I hope the people who this ultimately costs in terms of taxes or more expensive financial services will understand.
:beer:

I would hate to read a more thorough explanation

JimmyTheWig

A good summary, bowlhead99. You've spotted some stuff with the income that I had missed.
Problem is the OP isn't interested. He doesn't want our help or explanations. He just wants to help and explain to us something that we already know is unfounded.

I agree with _Andy_ - lets let the thread die.

potatoefeet66

Bowlhead99, firstly and lets take this one stage at a time, you mentioned to allow an application it needs to be driven by a range of factors...... a new house needs a valuation survey.

Why was i refused one and why did the underwriter assume that i was increasing ltv without allowing one to be done. other factors were met. I was not unemployed and have no history of credit issues.

whether or not this thread dies or not i not really bothered.

Im afraid while your and others arguments are hold some merit or another you all miss the point that the process was bent. Thanks for your help.

So far your explanation is fine I'm very prepared to have the figures for compensation as to what i did not and did lose out on in real terms or interest blah blah blah, so what about an explanation why lender won't answer the application anomalies, Maybe thats because if they appollogise for the balls up they may be without any option to correct the issue.......X tatar.

_Andy_

Why did you even bother posting all this drivel? You come on here, ask for help, get input from loads of people in the industry and then at every chance tell everyone they're wrong and you know it all.
Most tedious, pointless, annoying thread I've ever seen.