Condition on mortgage to pay all the outstanding credit commitments before completion

kingstreet

Muds1 wrote: »

I know my options like selling car or paying it somehow, but what I want to be sure is that when I agreed to pay in part, why this condition ?


can I not talk to lender to reconsider this as I never agreed to pay in full.

The condition is there because you indicated on the application you would repay some or all of the commitment on or before completion.

It is your interpretation of what this meant which is at fault. The lender is trying to establish if something will take place which will improve your affordability. Repaying a credit commitment would do that.

If you intended to continue to make your current monthly loan payments, you should have indicated "no" or whatever negative option was there.

You should now contact the lender and ask them if affordability would still be acceptable if the loan is not repaid as you erred in indicating it would.

Provided it is, you should be able to have the condition removed and a new offer issued.

halfone

Muds1 wrote: »

exact wording of condition is -- "You have declared an intention to repay some or all of your outstanding credit commitments The mortgage advance has been assessed on this basis and it is your responsibility to ensure that these commitments are repaid. Completion takes place on the condition that such repayments takes place."

(my bold)

I would't be panicking yet. Unless I've misunderstood something I'd be inclined to read that as they want you to keep on repaying as you have been, as you've declared you will. It'd be worth contacting them just to confirm exactly what they mean.

mrginge

lovehackney wrote: »

...and also our lender Woolwich, wouldn't have known if we had either.

I think you'll find they could have found out quite easily if they tried.

It's very easy to suggest the risk is so small that it can be ignored, but unfortunately the potential consequences of lying on a mortgage application can be huge.

Muds1

halfone wrote: »

(my bold)

I would't be panicking yet. Unless I've misunderstood something I'd be inclined to read that as they want you to keep on repaying as you have been, as you've declared you will. It'd be worth contacting them just to confirm exactly what they mean.

that to me sounds reasonable really (may be coz it says do not panic "yet")

TBagpuss

I would suggest that you ask them in order to clarify. As others have said, if you are at the top end of your affordability then they may require the loan to be paid off, or alternatively reduce the amount you are able to borrow.

I thin that the tighter things are, the more likely they are are check. So if you are borrowing a high percentage of the value of the house you want to buy, or if you are borrowing the maximum that you can, then this may be a solid condition and they may check.

When I sold my house last year the original buyer pulled out just before we were due to exchange. They had put a couple of thousand pounds onto credit cards and this pushed them out of affordability and their mortgage offer was pulled - so obviously there are situations where the lender will follow up on this kind of issues.

If you ask them, and the answer is that they do expect the loan to be cleared in full , then you may need to look at selling the car and buying a cheaper one as a temporary measure, until after you have moved, and if the answer is that as long as you continue the regular payments they'll be happy, then you can relax!

Hoploz

The wording you've copied down seems ambiguous to me. Ask the lender whether they mean repaid in full, or that you maintain the continuing repayments.

Muds1

Hoploz wrote: »

The wording you've copied down seems ambiguous to me. Ask the lender whether they mean repaid in full, or that you maintain the continuing repayments.

yes I will do that, talked to my mortgage consultant, he says it means continuing payments as we clearly mentioned that we will make part payment before completion.

mrginge

Muds1 wrote: »

yes I will do that, talked to my mortgage consultant, he says it means continuing payments as we clearly mentioned that we will make part payment before completion.

So if ticking 'yes' means you are just going to carry on paying the contractually agreed payments, what would ticking 'no' mean?

That you would be planning to default?

Your logic, if correct would result in an utterly pointless question.

ask your mortgage consultant in what circumstances an applicant should tick 'no'.

kingstreet

mrginge wrote: »

So if ticking 'yes' means you are just going to carry on paying the contractually agreed payments, what would ticking 'no' mean?

That you would be planning to default?

Your logic, if correct would resupt in an utterly pointless question.

ask your mortgage consultant in what circumstances an applicant should tick 'no'.

One to brighten a dull afternoon.

Andypandyboy

I would have thought the question should be read as "in addition to your required payment do you intend to etc, etc. That is how I read it.

As the poster above says under what circumstances would someone tick no?