FTB - appealing a mortgage decision

ameygee

Hi guys,
I'm just looking for some advice. We've had an offer accepted on a house, and decided to go with Santander for our mortgage.
This was approved and then sent to the underwriters due to us wanting 95% LTV.
We had a phone call today saying they had declined it because on my partners bank statements there was a £10 returned direct debit fee.

A direct debit bounced in December, but the bill was paid the following day. We've checked our credit scores and this hasn't affected them at all, there isn't a late payment marked on the credit report. But due to the returned direct debit fee they have declined us.

Our mortgage adviser spoke to her supervisor and they agreed we should appeal this decision, which they're in the process of doing. We've supplied more bank statements to show the direct debit being returned and showing the payment being made the following day.

I was just wondering what the likelihood of being accepted is?
Or whether it's worth checking out other lenders, even though Santander have already put a hard credit check through?

Just in case the information is necessary the house we want is £99,950,
Deposit: £5000
Joint income: £39000
I get enhancements on my wages which is around £6000 per year.
From what I gather our wages and credit report all came back fine it is just this returned direct debit fee.

Any help is greatly appreciated!

amnblog

The direct debit was returned presumably because there were insufficient funds in the account to meet the payment?


On what basis are you appealing?

ameygee

Yes that's correct. It was for a mobile phone bill and unfortunately my partners dates were mixed up.
We're appealing as our mortgage adviser and her supervisor don't think it's a sufficient reason to decline our mortgage application, especially as it hasn't been deemed a late payment on our credit report.

ameygee

Any other advice?

pookied87

It will more than likely still be a decline the way the underwriters see it.. is that funds should have been present to pay for the bill regardless of what day it went out. Its shows not having much organisation in budgets and commitments etc

regardless Good luck

ameygee

Okay thank you for responding.
And do you think other lenders would be of the same opinion?

ACG

Whether it was late or not on the credit report is irrelevant. You have not been declined because of a late payment by the sounds of it more like bank account conduct.

At 95% LTV you generally need to be spotless.

Why did your advisor not pick up on this before applying?

Its worth appealing as you have nothing to lose but I would not be holding my breath and would be looking for a plan B.

Thrugelmir

ameygee wrote: »

We're appealing as our mortgage adviser and her supervisor don't think it's a sufficient reason to decline our mortgage application, especially as it hasn't been deemed a late payment on our credit report.

Underwriters don't give reasons for a decline. Mortgage advisors aren't neither trained to underwrite or will know what current lending policy is.

Use a broker to find an alternative lender. As at 95% LTV underwriting criteria is very stringent and there'll be best placed to advise the most suitable lender.

GMS

Another example of why credit scores from CRA's are pointless.

Do you have a proper broker or somebody in Santander?

If the credit report doesn't show it then you could try a lender who wouldn't ask for bank statements possibly.

From an underwriter point of view if you can't ensure a mobile bill gets paid then why would they approve a loan for £95,000.

ameygee

Our mortgage advisor in Santander looked through everything and didn't think there was any reason why we would be declined, we should hear back tomorrow.

We seen a broker, and they stated our best option was either Santander or Virgin money because they were offering the best deals, we had already seen an advisor through Santander to continued to go into branch.

No I totally understand we are considered a high risk lender, this was the only time a bill wasn't paid. I was just wondering if it was worth trying another lender if declined, or cutting our losses and saving up more.

Thank you for all your replies.

GMS

Go back to the proper broker.

Make sure they know the full story.