Lenders pulling out after Exchange - How prevalent is it REALLY?

DpchMd

Dave_Ham wrote: »

Have bitten my tongue on a couple of previous posts, but having half an idea does not give you the full landscape for sweeping statements and inflammatory assumptions (see other posts)


I agree that changing a bank account/phone contract should not affect a mortgage offer and certainly not post completion.


That much agreed, but taking additional HP and finance generally (such as a loan in your example) would and has absolutely seen mortgage offers amended (rather than withdrawn)


If a mortgage offered with a set specific income and commitments, an additional financial commitment post offer/exchange has to be factored in.


In reality not all lenders check and not all lenders would even flag this, but the suggestion on here not to do it is valid and prudent.


Anyone who uses Leeds often enough (necessary evil at times) will realise that they do check and do make amendments right up to completion for exactly these sorts of material changes.

Thanks Dave, we know all of this and other brokers have also repeated the same information in this thread.

Do you have any stories of lenders pulling out that you can share?

haras_nosirrah

I have one. It wasn't post exchange but it was post offer

Did a nationwide mortgage at 90% for a client and got the offer out

Client had her deposit in a nationwide account and went in to the branch to move it across ready for exchange of contracts

Branch person talked her into opening a credit card to improve her score (or similar bs)

Prior to completion lender checked credit score and picked up the new credit card which the client hadn't even received let alone spent money on and this meant her score dropped so that she needed a 15% deposit to proceed so have to find an additional 10k

We appealed on the basis that this was as a result of a nationwide branch staff trying to hit a selling target but they wouldn't budge

Dave_Ham

So here is the kicker and by the way I would guess you probably don't know all of this, or certainly not as much as you credit yourself with.


I find it incredibly frustrating when anyone comes on here or elsewhere and thinks with a bit of reading, you can make up for many years experience of this all day every day like we have.


No, I have no personal experience of this as we appropriately manage our clients and therefore would not authorise/allow a client to take out additional finance post mortgage offer.


I can think of 3 clients in 2014 that came to us after having their offer amended (post exchange in 2 of the cases) as there were material changes to their circumstances.


2 were from Leeds and due to taking out additional finance post offer and we had to put to a more flexible lender for affordability purposes with the loans/credit declared as is.


1 was due to source of deposit and the solicitor speaking with the lender as the previous broker had not appropriately confirmed the source. Again needed a different lender and needed to be well managed.


In answer to this one of many questions, a mobile phone or bank account change is highly unlikely to affect a mortgage offer whereas increasing credit on cards or new loans are likely to and not worth the risk.


But sure you knew all of that

DpchMd

Dave_Ham wrote: »

So here is the kicker and by the way I would guess you probably don't know all of this, or certainly not as much as you credit yourself with.


I find it incredibly frustrating when anyone comes on here or elsewhere and thinks with a bit of reading, you can make up for many years experience of this all day every day like we have.


No, I have no personal experience of this as we appropriately manage our clients and therefore would not authorise/allow a client to take out additional finance post mortgage offer.


I can think of 3 clients in 2014 that came to us after having their offer amended (post exchange in 2 of the cases) as there were material changes to their circumstances.


2 were from Leeds and due to taking out additional finance post offer and we had to put to a more flexible lender for affordability purposes with the loans/credit declared as is.


1 was due to source of deposit and the solicitor speaking with the lender as the previous broker had not appropriately confirmed the source. Again needed a different lender and needed to be well managed.


In answer to this one of many questions, a mobile phone or bank account change is highly unlikely to affect a mortgage offer whereas increasing credit on cards or new loans are likely to and not worth the risk.


But sure you knew all of that

No-one said any of that, Dave.

I'm just looking for stories of lenders pulling out, as I find it a fascinating topic.

Thanks for the info!

DpchMd

haras_nosirrah wrote: »

I have one. It wasn't post exchange but it was post offer

Did a nationwide mortgage at 90% for a client and got the offer out

Client had her deposit in a nationwide account and went in to the branch to move it across ready for exchange of contracts

Branch person talked her into opening a credit card to improve her score (or similar bs)

Prior to completion lender checked credit score and picked up the new credit card which the client hadn't even received let alone spent money on and this meant her score dropped so that she needed a 15% deposit to proceed so have to find an additional 10k

We appealed on the basis that this was as a result of a nationwide branch staff trying to hit a selling target but they wouldn't budge

Good to see that some lenders are using up-to-date data. When I applied for my mortgage my lender picked up accounts that I had closed 3 months prior, and I had to source evidence of settling the accounts.

kingstreet

DpchMd wrote: »

When I applied for my mortgage my lender picked up accounts that I had closed 3 months prior, and I had to source evidence of settling the accounts.

The trick here is not to assume the credit system has been updated by the providers.

Enter the data as if the accounts/balances still exist and note them to be repaid on, or before completion.

Intended for future readers of the post, really.

amnblog

Asking mortgage brokers for examples of offers pulled is fishing in the wrong pond.


By definition we know what we are doing and manage our clients to avoid such eventualities.

DpchMd

kingstreet wrote: »

The trick here is not to assume the credit system has been updated by the providers.

Enter the data as if the accounts/balances still exist and note them to be repaid on, or before completion.

Intended for future readers of the post, really.

In my particular example, I checked my credit files using checkmyfile and all of the accounts I'm talking about were showing as settled.

Mortgage submitted several weeks later and they still wanted evidence that the accounts were settled.

Out of date data.

haras_nosirrah

had it not been a nationwide mortgage in conjunction with a nationwide credit card then it is possible it wouldn't have been picked up - internal systems and all that

all I know is I got a call from the solicitor advising me that nationwide had written to them to advise them there was a problem and when I phoned my bdm they said it was due to credit score and asked if the client had taken out any further credit. Phoned the client and she told me what had happened.

Twiglet12

I have a quick question. We've just taken out a mortgage with Leeds, being paid out today for completion tomorrow.

We've been holding off putting anything on our (clear) credit cards for obvious reasons. I'm going on a business trip to the US next week and need to book car hire, hotel stay etc. which will all eventually be covered by my employer on an expenses claim. Am I safe to do this as soon as completion has gone through?