Mortgage Offered... but now bank is investigating further?

manub

Hi all,

I received a mortgage offer from Halifax on the property I'm willing to buy a month ago (5% deposit).

Today I heard from the solicitors that Halifax didn't give the OK to exchange and completion (I'm aiming to complete on the 15th of August) because of the searches reports. The flood searches came with a high risk of groundwater flooding and there are some rail works planned within 10 miles of the area.

I appointed an independent Chartered Geologist to run a groundwater flood report that came back with low risk, and the rail works are not in proximity of the property.

Do you know if that's a normal situation? This thing has been going on for 2 months and a half and I've found it really disappointing that my lender only has doubts now instead of getting the documentation needed before accepting to give me a mortgage...

What would you do in my case?

Many thanks

Thrugelmir

Lenders prerogative. You've still plenty of time.

manub

Thanks Thrugelmir - I'm a First Time Buyer so I don't really know much about these things. I still find it frustrating, specially as I have to vacate my rental property on the 31st of August!!!

Any expected turnaround times? Should I be seriously worried?

macman

Initial mortgage offers are always made 'in principle', which effectively means that they are under no obligation to proceed with the loan if they find something untoward after valuation.
Never a good idea to burn your bridges re. existing accommodation until you have a definite exchange and completion date.
If you haven't even exchanged yet, then most unlikely that you will complete by 15/8.

manub

macman - my offer was not the offer in principle, but actually was agreed AFTER valuation. Having a 2 months notice period I had to give notice in order not to pay mortgage AND rent for a month... I can arrange living somewhere else in the meanwhile - that's not a problem, but I just wanted to understand if that's normal.

kingstreet

It is completely normal for issues like this to be resolved after the offer is issued. This is because the mortgage offer is often the solicitor's first communication with a lender.

If you had all the legal work done before making the mortgage application, you could have submitted these findings to the lender earlier, but most people do the mortgage first as that is the thing most likely to cause issues.

amnblog

Another way to look at it is that the Lender may be helping you to avoid buying a 'pup'.

manub

I know amnblog, however I've just found out that apparently my solicitor hasn't forwarded the report from the geologist to the lender. I would be more than happy to avoid a 'pup', but at the same time if I had an independent survey done and that has resulted good I think that should be taken in consideration.

I'm not frustrated for the fact that they may not give me the mortgage, my problem it's more about the timing of this happening. And my solicitors which are completely useless...

Thrugelmir

manub wrote: »

I appointed an independent Chartered Geologist to run a groundwater flood report that came back with low risk,

What frequency? 1 in 200 years?

manub

He said that the risk is the same as what the Environmental Agency classifies as LOW, which is less frequent than 1 in 100 years but more frequent than 1 in 1000 years.

manub

Never mind. The bank hasn't made any decision yet or they didn't tell anybody about investigating further. That's only what one of the solicitors said, real status is they're just waiting after they've sent them the papers. Bunch of useless people