Santander Mortgage Advice

Luxexterior

Hi I'm a newbie if this as been covered before please make allowances.

I am currently in the process of selling my house/buying a new one. Because I have a good rate on my existing Alliance & Leicester mortgage & because I thought it would be quicker I decided to port my existing mortgage. Because A&L are now part of Santander I have had to transfer my loan to them, this is where the problems begin.

Firstly they are grindingly slow, OK little I can do about that but worse was to come when I eventually got my mortgage affordability interview with them (despite already having done this with A&L). I am borrowing a small amount of additional money (less than my original loan) over the existing mortgage period. All was fine until I was asked if I owned another property, I do so answered yes. The details of the property are that my aging Mother lives in it, she is entirely independent, has her own income & pays all the household bills, she does not pay me rent & I do not contribute any money to the property at all.

Santander could not understand this & insisted that as a relative living in a property that I own she is therefore a dependent & that I am responsible for all her bills & the up keep of the house. We went through what I thought was a theoretical list of her living costs, when I received my mortgage agreement to sign today I was shocked to see that not only is she listed as a dependent but the "theoretical living costs" have been added to my monthly out goings. Santander seem incapable of understanding that I do not pay any of her costs, despite me providing bank statements etc showing all my regular outgoings.

My worry is that if I sign & return the forms as they are one of their underwriters fail my application at the next stage because of these bogus outgoings? There are also a number of mistakes on the agreement details that I have been advised (by Santander) to correct & sign. Should I do the same with same with the bogus costs? Is there any way I can convince Santander that my Mum is not a dependent?Or should I just kick Santander into touch & start from scratch with a sane lender?

Sorry about the length of the above. Any advice would be gratefully received.:)

kingstreet

The dreaded "retained property" questionnaire!

It's true, they take the cost of the property into account when establishing affordability.

Upto you if you decide to stick with it or move on...

Luxexterior

Yes I could understand that if there were any costs associated to the property but there are non. Also their hypothetical costs include utility bills & shopping/food costs!

My application has made it through the affordability check/mortgage interview despite the above but I'm worried that their underwriters will refuse the loan on the basis of these non existent monthly costs, how likely is this?

Do all lenders take the same view as Santander over this issue? It seems crazy surely a mortgage free property is an asset & not a liability. Santander have already taken an age with my application but if they are likely to refuse at the underwriter stage I wonder whether it may be better to elsewhere.

kingstreet

Don't know, can't say.

No, Santander is a one-off in this respect.

Luxexterior

Thanks for that kingstreet, very interesting. If most lenders don't take Santanders bonkers line maybe I would be better off going elsewhere.

My concern is losing time, I have a buyer desperate to buy my house & my seller is eager to sell. Because the mortgage has been approved in principle (survey fees etc paid) does this mean its likely to pass underwriting?

Would it be worth adding a note to the relavent part of the mortgage agreement to the effect that my Mother is financially independent & that the house incurs no costs to me?

kingstreet

It will make no difference. They are not going to change their entire lending policy for one borrower. You take it or leave it.

They don't move on stuff like this for brokers either. That's one of the reasons their lending has gone through the floor in the last eighteen months.

Thrugelmir

Because I have a good rate on my existing Alliance & Leicester mortgage

How good a rate? As this may well influence their decision as well.

Luxexterior

0.99% above the Bank of England base rate, plus no tie ins or redemption charges.

onlyroz

Could you not charge your mother a "rent" equivalent to these living costs, and then use the "rent" to pay her bills?

Luxexterior

Yes this has occurred to me but its not really practical (or moral) because my mother is in her late eighties & easily upset/confused. I don't think she would understand the arrangement. Also if I wasn't actually charging rent & I state that I am wouldn't this be fraud?

I am angry that the mortgage company have put me in this position. My mother is not dependent on me financially & the property incurs no costs to me. In hindsight I should have gone to a broker for advice, he/she would probably been aware of Santander's oddball criteria & advised accordingly. The second property wasn't an issue when I took my current mortgage out. Surely if anything it should be viewed as an asset.

I have received contracts from my solicitor today & I am now unsure if I should sign & proceed now or wait for Santander to underwright the mortgage. What should be a significant positive milestone in the selling/buying process has been turned into a negative & uncertain experience thanks to Santander.

amnblog

If you want the bottom end rate offered by Santander you have to meet their criteria.

Don't expect to get 'cheap' with good service and thoughful consideration of your case.

If you are not particularly concerned about achieving the lowest rate, switch lenders. All the major ones will be more sensible than Santander.