Already received mortgage offer but now lender has dropped their rate

Halloumi

Our offer was issued a couple of weeks ago and our purchase is progressing relatively well. We still have a few things to look into but we are provisionally (optimistically) thinking of exchanging in a couple of weeks.

I now see that the rate on our product has dropped quite a bit since our offer was issued and we would save ourselves £55/month on the new rate.

Has anyone got any idea what the implications of asking to switch to the new product rate would be for our purchase?

Would we have to wait for another telephone appointment to do the FMA again?

Can the existing valuation be transferred over to the new application or would they have to do a new one?

Would it be likely to scupper our planned exchange date?

The lender is Nationwide. Obviously these questions are best posed to them tomorrow, but my mind is racing at the moment and I'd love some anecdotal or professional input.

ReformedShopper

What are the implications for going for a product switch midway through the housebuying process?

Mortgage offer issued, but no fees paid yet, apart from valuation fees. Product fee to be paid on completion. All the details will be the same as the original application, the only exception being the new product ends 6 months after the original application. So original offer was 2 yr fix, ending in June 2016, and new product (same LTV, same property details) is 2 yr fix ending in December 2016, with a lower follow on base rate (3.49 as opposed to 3.89)

Will this be a case of a revised offer or a whole new application?

kingstreet

It varies from lender to lender.

You really need to ask yours.

One lender won't allow it at all. Even if you cancel and start again. Another, it takes about five minutes online and you can offer the case pretty much instantly.

ReformedShopper

Thanks kingstreet. Will call and check what they say.

kiddakidda

Halloumi wrote: »

Our offer was issued a couple of weeks ago and our purchase is progressing relatively well. We still have a few things to look into but we are provisionally (optimistically) thinking of exchanging in a couple of weeks.

I now see that the rate on our product has dropped quite a bit since our offer was issued and we would save ourselves £55/month on the new rate.

Has anyone got any idea what the implications of asking to switch to the new product rate would be for our purchase?

Would we have to wait for another telephone appointment to do the FMA again?

Can the existing valuation be transferred over to the new application or would they have to do a new one?

Would it be likely to scupper our planned exchange date?

The lender is Nationwide. Obviously these questions are best posed to them tomorrow, but my mind is racing at the moment and I'd love some anecdotal or professional input.

How did you get on?:)

JulietWhisky

kiddakidda wrote: »

How did you get on?:)

Not Halloumi, but I am in the same position. I rang Nationwide today and unfortunately couldn't get hold of the mortgage consultant who took me through my application. But I did speak with another consultant....

The outcome of that was:
It's just a case of them "re-keying" the new interest rate. It won't have to go through the offer process again. You do, of course have to pay the £99 booking fee again.

Just waiting for my mortgage consultant to call me back now so I can get the ball rolling.

Halloumi

kiddakidda wrote: »

How did you get on?:)

Thanks for your interest kiddakidda.

I called first thing and was told that I would have to wait for a call back from my mortgage consultant, but that the process should be fairly quick from there on.

I didn't take my eyes off of my phone all day Monday and then today but unfortunately didn't hear anything (I know they're extremely busy). I lost my nerve tonight and had to get a time out of them or else I would have gone crazy with the worry.

I'm now booked in for Friday - sounds like it will take a little longer than five minutes though. I've also been warned it could take 5 days for the offer to be reissued, so it's looking very tight.

Still, for the money saved I hope it will be worth it. I'm becoming a bit of a Nationwide fan.

mikeyscott

Is this general market movement, would be interested to know what's happening with farcical post office rates

andymd

I asked the same question of Nationwide and their response was "This would be a new application (all fees and valuations and reinstruction of solicitors)"

Not sure if this is right. Does seem strange that they'd need to do another valuation (they did one 3 weeks ago) and presumably I'd get the £999 product fee I've paid for the original rate back (Not the £99 reservation fee) although the reply suggests I wouldn't. Will be interesting if other people are getting different advice from Nationwide.

JulietWhisky

andymd wrote: »

I asked the same question of Nationwide and their response was "This would be a new application (all fees and valuations and reinstruction of solicitors)"

Not sure if this is right. Does seem strange that they'd need to do another valuation (they did one 3 weeks ago) and presumably I'd get the £999 product fee I've paid for the original rate back (Not the £99 reservation fee) although the reply suggests I wouldn't. Will be interesting if other people are getting different advice from Nationwide.

Interesting....two separate people at Nationwide have now told me it can be done. As well as Halloumi being advised the same.

I have an appointment tomorrow (Thursday) to get my rate changed. I will let you know the outcome.

JW.

Halloumi

andymd wrote: »

I asked the same question of Nationwide and their response was "This would be a new application (all fees and valuations and reinstruction of solicitors)"

Not sure if this is right. Does seem strange that they'd need to do another valuation (they did one 3 weeks ago) and presumably I'd get the £999 product fee I've paid for the original rate back (Not the £99 reservation fee) although the reply suggests I wouldn't. Will be interesting if other people are getting different advice from Nationwide.

Andy - would your AIP have expired by now? I was told by the guy I spoke to that it might make a difference to the length of the process (mine wouldn't have done).