Woolwich mortgage declined

Hopeful05

Please could anyone offer any help? I already have a Woolwich mortgage, 7 years into a 10 yr fixed rate deal. Times have been a bit tough lately so I decided to sell and buy something smaller, pay a load off the mortgage and free up some money to pay off some other debts, in effect just porting over the mortgage. This has been declined! Despite the fact that my mortgage advisor fully supported the application, followed the logic that I actually already owe them the money, approx 92k, and that rather than risk repossession, which would be likely if the situation isn't addressed. Even when in the branch, the 'computer' didn't say no, just that it would need to be referred, it even acknowledged the downsizing. But now apparently, the powers that be, are saying no. Credit history is bad at the moment, I accept that, but I'm not actually asking for more money, I actually want to pay them some off - 13k, so I'd owe them less, be paying less a month and be better off myself therefore improving my credit rating again. Is there any way to get this overturned?? Any help would be appreciated, time is of the essence, the house already has a buyer who has already had survey done and paid for searches etc, as have I on the new cheaper property. Many thanks

Dave_Ham

Incredibly unlikely they will overturn, would turn to putting energy into finding a lender that will accept.

Granted, I assume you have the low tracker rate product so you may be better off staying put...

Hopeful05

Thank you for you reply, unfortunately I can't really afford to stay where I am, and to look for another lender, would involve arrangement fees that I also couldn't afford and the woolwich would then also charge penalties for moving away from them too. Seems all very daft when the fact is that I am not asking them for more money, I actually want to give them some back

Hopeful05

Could you possibly say which possible lenders they may be, so I can at least have a look into them please, thank you very much

Dave_Ham

I appreciate your frustration and your logic about minimising their exposure is sensible.

Unfortunately, getting a lender to see this is virtually impossible.

A lender selection will be dependent upon significant amounts of information we do not have on here, nor am I allowed to name drop lenders.

If you detail what missed payments, defaults etc. could potentially give you an idea of expected rates although you are likely to require regulated advice.

Good luck

ACG

If your porting a mortgage, its treated as a brand new application so you have to meet criteria as it stands now... im on your side with this, i think its crazy that you should have to look at other lenders when your actually reducing their risk and exposure.

Unfortunately as Dave says, lenders (and i dont just mean Woolwich) do not view it in the same way. So you would be better looking for a new lender who will accept you. This will come down to your profile as it is now - so its worth getting a copy of your credit reports to a broker.

Any fees can usually be added to the mortgage itself so other than the ERCs (which again you may be able to include into a new mortgage depending on the LTV) may be the only fees you would have to find.

Could you not speak to woolwich and ask them to extend the term to reduce the payments?

kingstreet

When do the FSA/FCA relaxed rules on "prisoners" start?

Surely this is exactly the kind of case the FSA was thinking of when it published the post-MMR paper last October.

Applying credit and affordability rules in this situation is counter-intuitive.

Apparently it's October 2014...

http://www.fsa.gov.uk/library/communication/pr/2012/098.shtml

Transitional rules (affecting borrowers sometimes referred to as ‘mortgage prisoners’) - enabling lenders to make exceptions to the responsible lending rules for customers who need to remortgage, providing there is no increase in the outstanding amount to be repaid.

and

Existing borrowers that cannot meet the new affordability requirements - lenders can ‘switch off’ the affordability and interest-only requirements for existing borrowers who want to get a new mortgage for the same amount or less. While any lending decision is a commercial one, lenders will also be able to use these arrangements to take on the customers of other lenders. Lenders will, with immediate effect, be prevented from treating these customers less favourably than other customers.

Despite the bold item, I have yet to see any difference!