Nationwide mortgages have attractive rates but are impossible to get

jmiles1

My husband and I are in an incredibly fortunate position financially yet I cant get a further advance secured which is just nuts. Let me explain

Joint income of approx. £200k per year, no loans, HP or credit card debt. We are entitled to final salary pension schemes. We have each been employed by the same firm for 31 and 35 years each. I am aged 51, hubby is 54. We get a company car each for life (yes really) so we will never have car expenses. I also get free petrol. We have one daughter who is at university who we fund as I disagree with her running up a massive student loan so she is dependent on us financially

My current LTV is 31% on a £700k house (valued by Nationwide last week at that) . Current mortgage with Nationwide is £218k
Additionally own outright 2 other properties (ie these are mortgage free) – one is valued at £700k and is currently let under an AST agreement to disabled mother. Because she is a relative I cant get a buy to let mortgage on it or raise funds against it. We moved her into this 6 months ago due to her ill health and fortunately it coincided as our tenants wanted to move out.
Other property is a flat is worth about £250k and is let under an AST agreement to a non-family member. I realise I COULD get a buy to let mortgage on this.

Am trying to raise £150k secured against my home over 10 years to buy my daughter a flat as she starts a 12 month placement at the end of June. This would take our home to about a 52% LTV. I was hoping she would be off payroll for a year but sadly with a salary of a paltry £65 a day in Surrey (one of the most expensive places in the country to live) then my hopes are dashed. Its cheaper to buy her a flat than have her rent and she cant afford rental rates of £1100 a month anyway. She wont get free council tax in Surrey as she does when she is at university so this puts her almost below minimum wage.

We passed Nationwide’s affordability test with no issue, went through the step with the mortgage advisor, went through the application process so went to the accept stage, was told it was going to offer with a usage of the money put down as ‘personal consumption’ but the underwriters rejected it at the very last final hurdle. We were very open how the money was to be used but because our daughter will be earning a (small) salary they class her as not totally financially dependent on us. So after 2.5 hours of interviews, sending all sorts of information and what has ended up wasting about 5 hours of my life, I am cross ,frustrated and depressed for all those who are in a much worse situation than I. If I cant get funds when I am a very safe bet, what hope do others have?

I will continue with the Surrey flat purchase as I will either borrow the money off my mother in law or I will cash in savings and shares to raise the funds. A mortgage rate of 1.79% looked attractive on paper and would have saved me a lot of messing about. That’s all I think the Nationwide mortgage ever was, a headline offer that is unattainable with Nationwide sticking to rules that are frankly far too tight and inflexible in the UK right now. At least I have options, many don’t. Over the coming months I will gradually move my business away from Nationwide to other providers. Nationwide wont notice and wont care but it will certainly make me feel better.

JPB123

This can be placed quite simply, on interest only if need be, as it doesn't sound like a long-term place for your daughter.


Speak to a competent broker (no corporate High Street EAs) and it could be sorted inside a week.

I am an Independent Mortgage Adviser

You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.

Angie_B

Why can't your daughter rent a room in a flat share for approx. £500 a month rather than a whole flat for £1100? The £500 is less than 50% of what she is earning and would leave her plenty to live on?

As an aside, I have just secured a Nationwide mortgage the 1.79% rate you talk about with no problems whatsoever, so it can be done and is available to regular joes like me. Clearly you did not meet something in Nationwide's lending criteria.

amnblog

There are a number of ways you can handle this issue.

As you have noted, speaking to an adviser at Nationwide BS is not one of them.

Engage a mortgage broker.

jmiles1

two she looked at the landlord started asking inappropriate questions and creeped her out. I considered in the end it wasnt safe and would prefer her in her own place. she doesnt know anyone in the area. its different when she is at uni. Thanks for the advice though

anselld

£65 per day is a perfectly adequate salary for a placement year student in Surrey. Why not just let her get the experience of making her own way? That is part of what placement is about.

Thrugelmir

Why are you trying to release equity and not applying for a mortgage through another lender.

jmiles1

Thanks thrugelmir. I was keen to stick with same provider as my current mortgage is very old and enables me to overpay and draw down funds when I want. It has been a useful cheap line of credit. New mortgages don't

jmiles1

Sorry muppet alert and pressed send too early!

So new mortgages don't have that facility to draw down as needed. Maybe I will need to look for a new provider although I can borrow the money off mum at 2.5% interest only which will cost me £312.50 a month. Much cheaper option

Let_Us_See

Re-mortgage the let property to raise the funds and then buy outright. Assuming you are both higher rate taxpayers, it will also allow you to offset interest payments against rental income. Win, win situation.

Red-Squirrel_2

jmiles1 wrote: »

two she looked at the landlord started asking inappropriate questions and creeped her out. I considered in the end it wasnt safe and would prefer her in her own place. she doesnt know anyone in the area. its different when she is at uni. Thanks for the advice though

Yet many thousands of young women rent while at university and in their early twenties and survive the experience just fine, many of us in fact will tell you it was a hugely beneficial learning experience.

Please be careful that in trying to give your daughter the best you can that you aren't in fact depriving her of something equally valuable but in a different way.