Help needed - EA asking us to change lender

stevethecadman

Hi MSE folk,

My partner and I are first time buyers and have recently had an offer accepted on a property. We applied, by phone, for an HSBC mortgage on Wednesday, received the paperwork on Saturday and returned the application with all relevant documents in branch on the same day.


I contacted the EA today (Monday) to keep them up to date on our progress and when I mentioned HSBC it went down like a lead balloon. She claimed HSBC are ‘horrific at the moment’ and are likely to hold everything up. She has arranged for their mortgage advisor to contact me tomorrow to discuss our options as they c’an’t keep the house off the market without some progress on the mortgage side’. The advisor was previously unable to better several of the mortgages we had found online ourselves.


Now, does this sound a little unreasonable from the EA? HSBC have yet to do anything wrong or hold anything up. We have appointed a conveyancer from HSBC’s panel (so they can act for us and them) and I have heard plenty of positive outcome with this scenario.


I have a feeling that the EA wants us to submit a concurrent application with an alternative lender. Is this ok? And as our original HSBC mortgage application has a £899 fee attached, would we be liable to lose that sum?


A few days ago we were happy that we had completed our side of things and were looking forward to putting our feet up while the application was processed. Now we are feeling stressed again and wondering what to do. Any help from wise heads out there would be very much appreciated.


Thanks in advance.

SKIPPY

OK I'm not an expert here by any means but my first impression is cheeky beggers, sounds like they just want the commission for themselves. I'm sure someone with more knowledge will be along soon to advise you further.

GMS

Tell the EA you are happy with your mortgage application. If you have a decision in principle then produce it.

If they still decide to play games go to the property and inform the vendor of what is going on.

dunstonh

when I mentioned HSBC it went down like a lead balloon. She claimed HSBC are ‘horrific at the moment’ and are likely to hold everything up.

HSBC are tight on criteria and basically cherry pick. However, they are not horrific.

She has arranged for their mortgage advisor to contact me tomorrow to discuss our options as they c’an’t keep the house off the market without some progress on the mortgage side’.

So, they are putting you in touch with their in house sales rep who shares commission by slagging off a lender that doesnt pay commission. See where this is heading?

And as our original HSBC mortgage application has a £899 fee attached, would we be liable to lose that sum?

Normally you would lose it.

Is there anything that is likely to cause problems with HSBC? Are you pushing any limits?

I had an estate agent try it on with me once. He didnt know I was an IFA. He started giving me the usual lies about how they need to use their in house mortage adviser etc. They asked what I did and I lied and told them compliance inspector for the FSA. The EA went pale and couldnt backtrack fast enough. They cannot force you to use the EA broker. It is usually sales talk and you should stick to your guns.

stevethecadman

Thanks Skippy, the cynic in me thinks the same but to be fair, they had no issue with us using a non-advised lender when it wasn't HSBC.
It really seems like they don't want us to use HSBC. Surely it makes sense to sit it out for a week and see if HSBC approve/decline our application?

stevethecadman

Thanks GMS and dunstonh.

Is it ok to speak directly to the vendor? Might be a good idea as we seem to get along well.

We realise HSBC are picky and we are going for 90% ltv but I'm sure we pass affordability and credit history is squeaky clean. My partner has also been an HSBC customer for 15 years.

SG27

HSBC have a reputation for being slow. But the EA mortgage advisor will not be able to beat thier rates. We was going to go with HSBC but changed last minute to YBS because they released a market leading rate.

Go and see the ea mortgage advisor, take your aip and be polite and refuse what they offer. You need to keep the agents 'on your side' (yes I know they aren't!) the fact is you will need them over the coming weeks and months.

holly_hobby

Firstly HSBC don't accept intermediary business - only direct.

They are tight on underwriting (esp at high LTVs), but if you say your affordability is fine and you have a super clean credit history - there is no reason why you won't pass.

Having in a previous life in the 90s been an adviser in an EA (Abbey Nat) - I will tell you that the reason for the neg asking you to see the adviser is so they can qualify the mge offer on behalf of the Vendor (ie check that you can proceed) - which is part of the EAs svc provided to their Client.

Now, whilst in there and if you already have an AIP or DIP (or indeed your own adviser), if possible the mge adviser will try and poach you - its a cut throat business and if employed, they will have high monthly written and banked targets, so they are constantly under pressure.

As already stated, your offer must be verified for the Vendor, but all you need to do is pop in with your AIP/DIP, give them your solicitors details and thats it. You don't have to be rude, simply and politely decline the MAs service at that point, you can reserve the option to use them if HSBC app falls out of bed (or elect to go to a whole of market broker, whom may charge a fee, but will completely independent mge advice wise).

You may speak to the Vendor directly if they are in agreeance, although some only want communication via the EA and Sols.

Hope this helps

Holly

stevethecadman

Thanks Holly.

We have and AIP from Natwest for slightly less than we need (not that we were on the limit, just went a bit higher than expected in the end).

Are you saying we need and AIP from HSBC to verify our offer? The EA didn't mention anything about this nor ask to see the Natwest AIP when we told them we had one.

I don't think we have an AIP from HSBC but I'm sure I read somewhere that if you proceed past the telephone stage you effectively have one. Does it seem silly to ask for an AIP when HSBC are about to start processing our full application?

Thanks for all the help.

holly_hobby

You just need to be able to verify to the EA/MA, that you are in a position to proceed (ie have obtained a mge (subject to survey) for the required borrowings) - in order that they may confirm to the Vendor they have verified/confirmed your offer as justified (the object of the exercise, is to try and avoid on behelf of the Vendor and any chain, offers being made and accepted, but then later falling down on the buyers rejected mge application - so as you can see there is actually a valid purpose to their enquiry, other than an apparent selling opportunity, although yes it is also utilised by in the house adviser for this purpose.

I did say if you already have an AIP or DIP, if you don't no worries, just wait until you have recd confirmation from HSBC that you have been accepted (subject to survey), and then duly confirm the details to the EA.

Hope this helps

Holly

stevethecadman

The EA didn't get back in touch with me this week.
She did email the in-house advisor asking her to contact me - she emailed, saying: 'Do you want to give me a call?' I'm off work so she would have received an out-of-office reply. I didn't respond and just sat tight.

I called HSBC every day this week to see how they were 'getting on'. They received the application paperwork on Wednesday and called this morning to say we have been approved! Merry Christmas!

They've now taken the mortgage fee and say we will be contacted within 24 hours by a surveyor to organise the homebuyer report we requested.

Have to say, so far, this has been a very smooth and speedy service from HSBC.