Mortagage App rejected cos of pension!

dj1471

Could it be that you failed the stress test? There they're looking at whether you could still afford the repayments with interest rates at 7%.

Your broker should be able to answer that and advise on what to do next - that's what you're paying them for! If it was the stress test then consider a 5-year fix, these are not subject to a stress test.

starfish1

Its with Santander/Abbey for a 5 year fixed deal.

Thrugelmir

starfish1 wrote: »

Due to the nature of my Husband's work, the monthly contribution rate is a set figure and cannot be changed.

Then it may well impact the amount that you are able to borrow. As this is a fixed committment not a variable one. Certainly a "not contributes too much syndrome". Merely reduces the amount of available disposable income.

Lenders are naturally being cautious due to the uncertainty lies ahead. Hence the forward assessment of affordability on far higher interest rates. People are assuming low rates will indefinately be around. More than likely they won't. As there's no longer any support packages to influence the market, and there's been plenty of them over the past 7 years. Market forces will progressively take hold.

kingstreet

Prior to submitting an application, an affordability calculator has to be prepared which shows all the monthly income and expenditure.

At the end, it tells you if the mortgage amount is affordable and what supporting evidence will be required.

"Pension deducted before tax" and "pension deducted after tax" are specifically requested with the help note "enter amount shown on payslip."

If it was not entered in one of the appropriate places, the affordability calculations entered into the full application would have been incorrect.

Ask whoever submitted this to provide a copy of the affordability calculator output (pdf) and you can see if it was incorrect at the outset.

amnblog

Also, if you have outstanding unsecured debt, this will be pulling the Santander affordability down - whether or not you intend to pay it off before completion.

aylesburygirl

Are they saying they wont lend? or have they offered a reduced loan amount?
Abbey has a very straight forward calculator which you key in all the deductions off the payslips and then check the net pay matches up- if its been rejected I would expect their to be another reason, a pension deduction would just reduce the loan amount that can be borrowed rather than a decline.