Mortgage Declined on Affordability!

MissDitton

Hi Everyone,

Looking for some help and advice.

I have been through the mortgage application on my own (partner has adverse credit so that isnt an option)

We have had the AIP, the full information sent out, Valuation and Survey has been completed & earnings confirmed. We are borrowing £81k with £9k deposit. Only to find out yesterday the mortgage has been declined on affordability in case the interest rate rises - but I am being offered a 5 year fixed deal with the halifax.

I am completely at a loss, I am waiting for the MA to call me back but is all lost? Can I put down a bigger deposit to balance things out (could reach £3k extra from parents).

I am completely lost and devasted as our dream first home is hanging in the balance, any advise would be great.

Thanks - Ditton Girl

ACG

Is it a mortgage advisor you have used or have you gone direct to the bank?

A decline on affordability is not always a decline - it usually means they wont lend you what you want, but they will lend theoretically to you.

So a bigger deposit may resolve it, although it would come down to how much they will lend you.

If you have gone direct and you cant make the figures stretch then go and speak to an actual mortgage advisor (not a bank "advisor"). If you have gone by an actual mortgage broker (one that can look at more than just halifax), then ask them to do the research and find a lender where you do pass affordability.

1 lender not offering you what you need does not mean no lender will.

MissDitton

Hi Thanks for coming back to me,

I have spoken to the bank ( I have gone direct to them) they cannot offer me the mortgage unless I can find an extra £19,000.
He has took my complaint away with him and is now asking questions about it being leasehold and what amounts are paid.

I have booked an appointment at 12pm with a whole of market adviser who has dealt with the family accounts for over 20 years so hopefully something more reachable will be obtained from this.

My only other option is to go on the mortgage with my dad, but at 52 we will also be restricted as to who will lend at 30 year plus.

Other than that, we are going to lose the house and maybe stay with parents an extra year to save the money - but as you can imagine with the wallpaper picked and the plates bought this is the aboslolute worse case scenario for us

Fingers Crossed - any comments or feedback would be amazing.

Miss Ditton

kingstreet

Ground rent and service charges now have to be entered into the affordability calculator. If you go for a DIP and don't take this into account you can be offered more than you will get at full application when the real property details are added.

MissDitton

Hi thanks for the replies.

They never asked in the full application as to amounts, they just asked whether it was leasehold or freehold.
The specific questions are coming later after the decline, I am thinking they are trying to look at ways round it or they are trying to build a better case to show me why they are right.

I just feel I have been led so far down the path, for the difference to be £19,000 in DIP to Full Offer, somewhere along the line I have been misinformed.

Thanks

Thrugelmir

MissDitton wrote: »

I am thinking they are trying to look at ways round it or they are trying to build a better case to show me why they are right.

The lender is merely underwriting your application in the proper manner. There's no right to a mortgage. Lenders decide on what basis they are prepared to lend.

MissDitton

Would they have not done this before it was declined?

Thrugelmir

MissDitton wrote: »

Would they have not done this before it was declined?

Done what? The review of the application all forms part of the underwriting process.

dunstonh

MissDitton wrote: »

Would they have not done this before it was declined?

an agreement in principle is effectively an agreement that they would lend you the money that day if everything you have told them is correct, no new information comes to light that they are not aware of and that there is no change to their lending criteria.

lending criteria has changed a lot in recent weeks with the introduction of the MMR. So, you could easily have an AIP from pre MMR that leads to a failure post MMR. Unfortunately, it is a "thats life" outcome. You can ask them to review their decision again but if the underwriters say no then thats it. You either look to another lender or you find a new property that is not pushing the limits as much.

Dave_Ham

Whilst I sympathise as communication appears to be poor, you need to focus your energy on finding a new lender that will lend or a cheaper property.




See your broker and if they cannot find a solution speak to another broker, there are lenders that tend to lend more than Halifax subject to all of the details so certainly do not give up hope just yet..

MissDitton

Hi

Thanks all for the post's - I have been with a broker most of the afternoon looking through my options.

My bank (halifax) at the last minute called to say that all ways OK and the mortgage had been fully approved.

Someone somewhere had deleted / left blank the leasehold information so the bank assesor had put in the "default" amount when completing affordability to which added an extra £1000.

There was an ammendment to our leasehold in 1991 and therefore no more money has or will be paid towards it and that has tipped my affordability right back up and the offer is in the post, with an apology from the bank.

Happy Days! - Thanks All.

Very Happy Miss Ditton