Post Office Mortgage Refusal

baileywin

I appreciate theres probably not enough to go on here - but bear with me!

I recently applied for a Post Office mortgage through London & Country with my partner - 5 year fixed, 4.05%, 90% LTV (£200k property, £20k deposit).

Unfortunately, it was rejected - specifically I've been told that the second applicant (my partner) failed the credit check.

We weren't expecting to have any problems with the credit check so it came as quite a surprise!

We've checked my partners credit history through Equifax & Noddle (still waiting on Experian), and it all looks good - on electoral roll, credit card and bank account, no late or missed payments etc.

The only problems I could find are that:

I gave an incorrect previous address (we've been living in our current property for around 18 months) - think "The House North" vs "The House".

Our combined salary is around £50k which, using the Post Office's affordability calculator, should let us borrow >£200k. But my partners salary is made up of around £3.5k shift allowance (NHS) - using her basic we are then looking at barely above the £180k we need to borrow. When speaking to the broker they said that using her basic should be sufficient and should be easier.

The broker has since suggested that with such a high LTV, and being right on edge of the band, were really pushing it in terms of acceptance. They also suggested that theres no flexibility with the lender, and that they can't get any more specifics on the refusal so the next steps are to try an alternate lender (most likely Accord, or Norwich & Peterborough) who are maybe more likely to accept. IF the salary is an issue then perhaps an alternative lender may take this into account (I know that Post Office's affordability calculator just asks for "salary" but the Accord / N&P ones break it down into salary + enhancements)

We also have the option of borrowing (I know it'll need to be a gift for mortgage purposes) another £2k to bring us down to 89% LTV.

Thoughts on a postcard

pickles13

Can you not use Help to Buy Equity Guarantee scheme? We are using Bank of Ireland/Post Office and are also using the scheme.

baileywin

pickles13 wrote: »

Can you not use Help to Buy Equity Guarantee scheme? We are using Bank of Ireland/Post Office and are also using the scheme.

I thought that you had to apply for the loan, but the guarantee was done by the lenders direct - you don't know whether the lender is using it or not.

Basically my answer is "I don't know if I am - but I should be". Were FTB, we should be eligible.

(Post Office are in the scheme, but the other two I mentioned aren't)

Thrugelmir

baileywin wrote: »

We've checked my partners credit history through Equifax & Noddle (still waiting on Experian), and it all looks good - on electoral roll, credit card and bank account, no late or missed payments etc.

Any amount of debt owed?

baileywin

Thrugelmir wrote: »

Any amount of debt owed?

No loans or overdrafts in use. We both have credit cards but clear them in full each month.

amnblog

Accept the further advice from LandC or find a new broker.


Post Office - best for stamps

stator

Wait for experian report and see

baileywin

Having spoken to the broker, it's a definite rejection from the Post Office.

They wouldn't give any definitive reasons but expressed concern that we'd been registered to our current address on the electoral roll for <12 months (our credit reports show we've been registered there since October 2013, so 15 months - don't know whats going on there!) and that my partner wasn't on the electoral roll at her previous address (fair enough).

The broker has suggested that Skipton's 4.3% deal is the next best option as they are the next cheapest lender who are more lenient than the post office. Unfortunately I calculate this will cost us about £990 more. I'm a bit confused as to why the 4.3% (no fees) deal has been recommended when the 3.99% (with fees) deal is about £320 cheaper - but I need to discuss this tomorrow.

It was mentioned that Accord (who are the next cheapest to what we applied for) only do a soft search, and while the broker thought it was just as likely to decline as the Post Office, theres no downside to applying even if I face a rejection.

As the broker isn't whole of market, does anyone know if any of the following lenders are more likely to be lenient or do soft searches on applications?

Clydesdale,
Furness Building Society,
Norwich & Peterborough,
Coventry Building Society,
Britannia / Co-Op.

(nb I know the default answer will be "trust the broker" but this is a lot of money and I want to be 100% that I'm getting the best deal possible)

Slayerx

N&P and Accord are both part of the same organisation Yorkshire Building Society.

hounslowfish

Check your experian report. I was rejected for several mortgages because of mistakes (omissions) on my experian report. It was a horrible and stressful affair. I have the impression that experian is the main one banks check.

Needless to say, once experian fixed the problems I was accepted for a mortgage right away. Good luck!

And PS: Look for omissions on your report. Mine had huge holes in it - it didn't even include my previous mortgage!!

baileywin

hounslowfish wrote: »

Check your experian report. I was rejected for several mortgages because of mistakes (omissions) on my experian report. It was a horrible and stressful affair. I have the impression that experian is the main one banks check

Experian one hasn't turned up yet.

Accord rejected us, now to try Skipton. Getting desperate...