New Mortgage Rules ARGH!

travellady

HI,

would like some advice/help on the new mortgage applications-

Basically we have almost paid off our mortgage thanks to MSE, house value of 170k owing just 13k, we now need a larger home as there are 5 of us here - we went to our bank who we have all our accounts with along with business and current mortgage.

between us we have income of 33k and wanted to raise 120k to purchase another property as we dont want to lose it- then sell our current property, however the bank has told us we can only afford 47k!! I have checked credit files and theyre excellent at 999 so we know it isnt that.

We have showed we currently pay £822 on the mortgage pm and also over pay by £500 per month for the last 5 years.

Any idea what could be wrong? And where to go from here- ?

ACG

Nowhere near enough info.

Speak to a broker. they can go through income and expenditure and go from there.

Typhoon2000

I am guessing as you are already committed to pay £822 on the current mortgage, the bank reckons you can only afford to fund an addition 47k mortgage. Did you ask how much you could borrow if you were selling up at the same time or paid down your existing mortgage first?

travellady

ACG partner is Director- his SA302 showes 23300k pyr earnings/dividends. The rest is my ESA/CTCredit/ as we have 3 children- TSB said it could be due to having 3 children?? Only have 2x loan/ credit cards - car loan of 5300 and c/c of 3680 (of which we could pay with our savings but its zero interest so didnt really want to)

She said if she took away all of the loans and the mortgage theyd still only be able to lend us 47k.

She said am I sure that I have no other loans or mortgages... I said NO I think i would remember having a nother mortgage!

Maybe it looks like were just gonna have to sell this property forst and hope the other doesnt go. :-(

travellady

I've just given a broker a call he said he's having nightmares with mortgages at the mo-- he said it will be difficult to find one but not impossible.

How can having 3 kids affect mortgage applications? Can my other half go the mortgage alone as it is now- and not declare them?? Maybe we need to split up and he can pay 10 per month maintainence.... then he has no dependents!

somethingcorporate

Yes, having dependents impacts a mortgage application.

3 children are more expensive than 0 children (have you not noticed? ).

ACG

3 children = 3 mouths to feed/clothes/entertainment etc.
I bet you spend more than my household does (just me and my girlfriend) on food/gas/electric etc.

Your second post gives a completely different picture than your initial post.

Some lenders do not accept CTC/ESA etc, some will under certain circumstances (ie childrens age/term of mortgage, likelihood to remain on ESA).


I really do think you need to sit down with a broker, get everything down on paper and let them do the research. Thres potentially a lot of research needed here as not all lenders are going to pass this on affordability (as you have seen).

Goldiegirl

travellady wrote: »

I've just given a broker a call he said he's having nightmares with mortgages at the mo-- he said it will be difficult to find one but not impossible.

How can having 3 kids affect mortgage applications? Can my other half go the mortgage alone as it is now- and not declare them?? Maybe we need to split up and he can pay 10 per month maintainence.... then he has no dependents!

It wouldn't be a good idea to not declare the kids...... That's mortgage fraud, and if discovered would cause you a whole load of bother.

travellady

It still a stupis system though as our current mortgage is 822 pm I overpay 500 per month and a new mortgage of 120k is around 560 per month so we would actually be paying out around £700 per month less...

Thats what I find stupid, my eldest daughter is about to start work and is from a previous partner who pays for her direct and extra for us... I just think they should look more at the circumstances rather than sticking it in a computer. Surely if I cant afford a new mortgage of 560 per month how the hell am i paying 1322??

Bantex_2

travellady wrote: »

It still a stupis system though as our current mortgage is 822 pm I overpay 500 per month and a new mortgage of 120k is around 560 per month so we would actually be paying out around £700 per month less...

Thats what I find stupid, my eldest daughter is about to start work and is from a previous partner who pays for her direct and extra for us... I just think they should look more at the circumstances rather than sticking it in a computer. Surely if I cant afford a new mortgage of 560 per month how the hell am i paying 1322??

I would question that when your earned household income appears to be around £23k gross.

ACG

travellady wrote: »

my eldest daughter is about to start work and is from a previous partner who pays for her direct and extra for us... I just think they should look more at the circumstances rather than sticking it in a computer.

Did you explain that to the "advisor"?

Everyone of your posts gives a little bit more info.
Its being drip fed which is why (sorry to repeat myself) I suggest speaking to a broker.

I would be on the phone to the underwriter(s). It may be possible to put 2 dependents rather than 3.

There are reasons brokers are in a job. We do this day in day out we get ALL of your info and then run it by the lenders to find the one most open to your circumstances... theyre not all the same and not all run by a computer.

With all respect, you could spend a week on here moaning how its not fair/you dont understand it etc and get no further along, or you could sit down with someone and get an answer as to whether it is possible or not and hopefully move forward.

Im not going to reply anymore as I cant add anything more other than to say go and speak to a professional. As someone wrote on here yesterday, you can take a horse to water... (not that im calling you a horse lol... i'll get my coat).

Best of luck.