2nd BTL referred/declined

Vales

I have remortgaged my BTL and got equity for a new purchase
Although the property was valued at 400k and rental income at 1400 I was offered 57%. Not great but that still suited me to buy property n.2
I had a promise for the purchase for 400k LTV 70%
I applied for a smaller figure using my equity as deposit
I go declined with no explanation whatsoever
Broker say banks don't have to explain refusal, is that so? It would be useful to know if there is a mistake and on what basis I was refused
why did they offer in principle only a few weeks earlier?
could have been better to first apply for the purchase and only after for the remortgage? I followed broker instructions but now I am questioning that was the correct way to go about it
Any one of the expert has any advice?
Should I try different broker?
My current broker say he may find something else but will be more expensive and I do not think I should stretch myself. The deal I was promised was just fine
If I am not giving enough info do ask
TIA
I m gutted as it took ages to find the right property and get an offer accepted

kingstreet

You were offered 57% on the LTB because the rental income is only sufficient to service a loan of £224k (£1400 / 125% x 12 / 6% = £224,000).

So, you have £224k for a deposit. Are you buying a new residence, or a BTL?

If a BTL where are you going to live?

Assuming residential purchase - Which lender has declined you? Do you have any other issues, such as income stretch? How does the new lender treat the let property/mortgage you are just remortgaging? Some lenders deduct the new mortgage from your borrowing power, others ignore it if self-financing.

Vales

it is a second BTL
and they are both with the same lender
I live with partner somewhere else (no residential mortgage)

Vales

oh pardon its BM sol.

Sorry I don't understand this question
How does the new lender treat the let property/mortgage you are just remortgaging?

kingstreet

So you want to buy BTL for £400k as well.

How much did you apply for in the end?

What's the rental income?

Did it get to valuation, or was it declined before that?

Any issues you can think of which might have been a problem? How many BTLs? How many with Lloyds Group members?

I find it difficult to understand why they would have an issue with you if they are happy to lend on the first property, so I'm wondering if the property is the issue for the second?

kingstreet

Vales wrote: »

oh pardon its BM sol.

Sorry I don't understand this question
How does the new lender treat the let property/mortgage you are just remortgaging?

Ignore. It only applied if you were purchasing a residence, not another let.

Vales

buy for 350
apply for 256 / declined than for 216 - declined (no happy broker did 3 attempt without asking)

expected rental 1400/1500
did not get to survey at all !

the only issue I can think of is I am not on the voting roll at current address

only 1 BTL this was going to be my 2

no other loan

I know experian doesn't account for much but I have excellent score there

on your last comment I cannot but agree I don't get it and I am really at a loss on what to do.

Should I take it off this broker hands before I loose the property?

Cornucopia

You have enough equity to buy a smaller property outright. Why not do that?

kingstreet

The broker has to be able to come up with a reason for the decline, otherwise how can he be sure this won't happen again with the next lender?

You have to be able to plan with all the information to hand and IMHO he doesn't have enough to make another application, unless he knows and isn't telling you.

Vales

kingstreet wrote: »

The broker has to be able to come up with a reason for the decline, otherwise how can he be sure this won't happen again with the next lender?

You have to be able to plan with all the information to hand and IMHO he doesn't have enough to make another application, unless he knows and isn't telling you.

But what could it be?

Thanks for the heads up. I will speak to him in those terms. I don't feel comfortable to have him to anything further than this

Vales

Cornucopia wrote: »

You have enough equity to buy a smaller property outright. Why not do that?

I have not seen anything I can buy outright, may be be able to by a flat in a block and further afield, I am a bit worried about major works on those flats and the type of rent I can get

thinking about it though though