Mortgage

Swoosh84

Afternoon,

Just back from HSBC Bank, have already had an DIP and have now completed the full application. Credit Check & Affordability checked out and it has been passed to the underwriters.

I'm told this is normal due to me being a company director. Anyone any ideas how many people get rejected at this stage? All seems positive so far but it's not stopped me worrying!

Bit of background info:
House Value: £170,000
Deposit: £17,000
Annual Income: £37,000 (low salary high dividend, although they worked out a 3 year average of £36k from our company accounts)
Salary Multiple: 4.3x Salary

They also worked out after all bills and mortgage ect is paid we would be left of £1.8k a month. As it's a sole application they have not taking into account my wife's monthly income which is £1,041 so affordability is not an issue. We also have 3 children.

Whats the chances of our application being declined/approved? I've read many threads with regards to HSBC being very picky!

XboxGeek7

I'm hoping you get a response! I have a thread very similar to this with the same bank.

betmunch

Dont worry about it going to underwriters, thats normal for all applications.

I'd be more concerned about the fact you at right at the edge of what they will lend and it seems four dependents!

Why isnt your wife on the application?

Swoosh84

The maximum amount they would lend was £157,000, we are borrowing £153,000 so yes we are on the edge. Affordability wise its not an issue as the salary of £36k they are using does not take into account that I pay no tax on this figure. As i understand it, one of my employees could walk in with a salary of £36k before tax and get the same mortgage offer.

Doubt it will make a difference, but I'm hoping the fact that my business bank account is with HSBC it will help. Also concerning is the fact that the business is relatively young but we have had substantial growth over the years.

My wife was not included on the application because her guaranteed salary is only £641 per month and for some reason it brought the figure down.

betmunch

Will be interesting to find out what they say, please can you update the thread when you get a final decision?

We can all do with more info on HSBC rather than just assuming the worst.

Swoosh84

Sounds like you are a little further on than me farley, please keep us posted!

I've no payday loans ect, last time i used my credit card was in March 2012. Last used overdraft in Feb and used it around 10 times in the last 4 years. Most of which were well under £50 and cleared every month. Never had to use it for any more than 1 month at a time.

I'll let you know if I hear anything, did they provide you with any sort of timescales for the underwriter coming back? I was told around 3 working days. The HSBC mortgage manager is hoping to get in touch with me on Saturday but I think that's a bit optimistic myself.

XboxGeek7

I've been told the time frame is around 3-4 days too. so I should hear back next so I'll come back to this thread. Highly frustrating that all checks have passed (we were even congratulated by the staff member) to have the mortgage application come through stating "this is not an offer". Obviuosly I understand they need to check my wages are correct to what I say, just a little paranoid that they'll think my spending habits are crazy. If I provided 12 months (they ask for 3) they would have a clearer understanding.

Swoosh84

Well all the best with this farley, i hope all goes well for you (and me!)

betmuch, I note your previous post states all applications goes to underwriting. The mortgage manager may have just been telling me what i wanted to hear but she did state that had I not been a company director i would have received approval there and then without the need for underwriting. So not sure if HSBC actually underwrite every case.

betmunch

It is possible they have a fast track system in place to save on admin costs. Due to their secretive nature I couldnt tell you if they do or not though.

Maybe I should have said its the norm for an application to go to the underwriters. Either way its still nothing to worry about.

Swoosh84

Well heard back from HSBC this morning, good news! We have received approval! Was somewhat of a nervous wait. Particularly giving what I've read with regards to HSBC being picky and also all the various threads on Self Employed mortgages.

In the end it was pain free, I suspect many whom actually get through the process do not post about it.

I cannot fault HSBC though, they have been fantastic throughout and any queries i have had have been responded to within an hour.

For anyone looking for timescales on HSBC mortgages. I went in and got our Decision in Principle on Friday 31st May, all went through fine!

Put our offer on the house in on the Monday, accepted on the Tuesday.

Managed to get another appointment with HSBC for the full application on Thursday the 6th May, all went through fine and was passed to underwriters.

Finally, on the 10th May we received confirmation of our approval and we now have another meeting on Wednesday the 12th to sign the paperwork!

Although I've never been through anything like this, I would say 3 working days from Application to Approval is excellent!

Swoosh84

Should also add for any other company directors reading that they required the company accounts to be signed by the Accountant. I only provided them with the Electronic PDF copies I had!