Mortgage declined urgent advice needed. thanks

kinh

reapz69 wrote: »

So did u fail the first A.i.p or the D.i.p?

I guess I failed at the first stage, when they entered my details into the stystem, logged onto bank system, did a credit check and came back as declined?

DCFC79

kinh wrote: »

someone said this to me; Is it fixed or variable? If the former, over what term? If the latter, how does it move and what's the rate above base?

They didn't even tell me this, why is all confusing?! Which is the best option??

Well doing research would help with anything your not sure about.

hamster2013

the lender will look at your affordability as well as go up to 3.5-4x your annual income
if you are earning £28k, that means they would lend up to a maximum of £112 - depending on your affordability - i.e other loans and financial commitments/obligations.

so you are hitting the top end of what they would offer to lend to you, in addition, you have a £30k loan from the government - remember, that this £30k is a loan that will also have a 'fee' of 1.75% after the 5 years, and an additional 1% at least following that year on by year.
so that is an extra minimum £525 / annum going forward, in ADDITION to the repayment of the 30k over the lifetime of the mortgage.

depending on your age, lets say you are young and you can be eligible for a 30 years mortgage (i.e you are in your early 30s or younger):
£112.5k mortgage at 3.5% (which will go up after the fixed period) will bring you to a repayment of £505/month
the 30k government loan will cost you £83.3/month + a minimum of £43.75/month after 5 years = total of £127

so your total 'mortgage repayment' would be £632/month
in your earnings, your 'net' monthly income is around £1821
minus the mortgage, you would be left with around £1189

the bank has asked you for your bank statements - for X number of previous months, and they would have scrutenized it to see if you can live in that amount - keeping in mind a rise in interst rate of around 1% and how that would effect you ... etc
and a decision would be made on that mainly

the bad credit score does not necessarily always play a role if all the figures add up -
i would check your spending history to see in addition to the information you have given and based on that, the decision could have gone either way.