refused Nationwide payment break

ZS25

We have had our mortgage with the Nationwide for many years and never defaulted on payments. In April 2012 we took out a further advance to complete home improvments for our growing family and I am now on maternity leave. At the time of taking out that further advance we were told that we would still qualify for a mortgage payment breakto exted my maternity leave , not on the new borrowing but our pre existing mortgage accounts and could arrange this break by just phoning the Nationwide with a months notice. This I have done today but our application has been declined! This is even after getting it refered to individual cases team. I am so angry as I believe we were given the wrong advice by Nationwide mortage consultant back in April. Had we known our additional borrowing would rule out a paymeny break to extend my maternity leave we would have postponed the work. Does anyone have any advice about this? I have put in a formal complaint but do not think it will change the outcome. We are very low risk for taking a break as LTV is about 70% and the mortgage products we have allow payment breaks, I will be returning to work on the same salary and we can clearly afford the increased repayments. Thank you for any help!

kingstreet

Aren't payment holidays normally linked to overpayments made beforehand?

I'm trying to remember Nationwide policy, so I may be wrong.

kingstreet

This is what the Nationwide Intermediary site says;-

Payment Holidays

There may be times when your client wants to take a break from paying their mortgage. For example, if they are taking a break from regular employment or starting a family. Your clients can apply to take a payment holiday of between 3 and 12 months.

Transparent conditions

If your client wishes to take a payment holiday, they must:

Have held a Nationwide mortgage for more than 1 year
Have a mortgage that is less than 80% of the value of the home at the end of the payment holiday
If your clients are experiencing payment difficulties (i.e. income is insufficient to cover reasonable living expenses and meet financial commitments as they become due), please ask them to call us, or visit their nearest branch, to discuss all the options that are available as a payment holiday may not be appropriate.
Once your client's request has been granted, they'll receive a letter confirming the dates of their payment holiday

Terms and conditions apply.

Doesn't tell us much, TBH.

Are they using the further advance within the last twelve months to "reset" the clock?

marin_mayhem

My understanding of the 'payment holiday' from Nationwide is it allows you to 'borrow back' overpayments. So if you've not made any overpayments there's no holiday to borrow back? Other method is to add capital to the loan but this is not the case here.
Perhaps sit down with someone in the branch and check through the paper work you have had. Bad advice or poor explanation???

ZS25

Hi there, no with Nationwide for a break an overpayment is not needed nd they advertise themselves as offering breaks for things like my maternity leave for between 3-12 months. This is what I clarified with them before taking out our further borrowing. They were clear that we could not break from the new borrowing as that would not have been out for a year but the exisitng mortgages would be ok. I dont understand why there has been a complete u turn as nothing about our circumstances since has changed! Very frustrating!

ZS25

Hi there, thanks for your reply..my understanding of the Nationwide payment break is that you dont need overpayments to have been made, just had your mortgage with them over a year, 80% LTV..they are saying it is the extra borrowing we took out which has changed our mortgage in the last year (still 70% LTV) and that is the part I think we were misadvised about..at time of extra borrowing they said it would not effect our abiity to take a break from the main mortgage. ITs awful because of their error I now have to sort childcare and possibly get back to work in Jan. I wouldnt have a problem with this if had prepared for it but had assumed tht with a short break I could stay at home until April!

kingstreet

Do they know the current value of the property, or are they using a desktop system which may be unreliable?

Is it possible they think your payment holiday is over 80% now, or will be when it ends?

ZS25

just read your post again..yes I am waiting for someone from the branch to contact me and talk it through to establish why their advice has now changed

ZS25

HI again! Yes I read that on the site and reache the same conclusion about reseting the clock since the advance..but we were specifically told this wouldnt happen with the pre-existing mortage accounts..not really sure where to take it next?

ZS25

Hi not sure what system they are using to value the property but when went trhough the details on phone yesterday they said LTV would be 70% after break. I dont think we wold be considered high risk taking into account fact I am returning to work on same salary etc..it doesnt make sense to me!

kingstreet

Written complaint, then the FOS if you don't get a satisfactory response from Nationwide.

Set out what you feel they did wrong and what you want them to do to put it right.

Play on the misinformation when you asked for the further advance. There's every chance they can give (or not) a payment holiday at their discretion and will use this as their get-out if you don't use the further advance issue.