New Mortgage rulles panic, porting and more

lowtidesurf86

Hi, My wife and I have not been looking for a new property but have always thought if something comes along then we will have a look.
By some miracle we have found the perfect house, managed to sell ours and had an offer accepted.
We have a current £120000 mortgage on the previous property for the last 6 years. Never missed a payment and easily afforded it.
Now the offer has been accepted I have done some online calculators which are reassuring and should be able to burrow the additional funds.
£40000.
However I spoke to my current provider (Woolwich) completed their online calculator and I now have to go through a 2 hour interview/application process to port my current mortgage and burrow the additional £40000.
The problem is I only just pass the online affordability checker on Woolwich as my wife is now a stay at home mum and we have 1 dependant.
They have also asked me to bring, last 3 months payslips, 2 years P60s and 3 months bank statements. The problem is that as we havn’t been thinking about moving so we’ve been spending nearly all my income each month and living happily. Is this going to hinder the application?
Really worried that the bank will think that we are not going to be able to afford this new home even tho when we have the mortgage we will live within our means.

New Home: £245,950
Deposit: £85,000
Loan: £160,000
Salary: £38,000

Was just wondering what peoples experiences are with porting and burrowing additional funds with these new rules in place.

Cheers

amnblog

Don't waste your time going direct to Barclays if your affordability is tight.

Engage a good mortgage broker who can establish if you have an option with Barclays and if not them, which lender will consider you.

lowtidesurf86

Thanks for the quick response, affordability isn't a problem, it's just the calculator, we have 1200 excess to potentially pay a mortgage with,
If I don't stay with woolwich until our existing deal expires we will have a 3% penalty, speaking to my FA, he suggests this is the best route to begin with to avoid fines, just worrying about how grueling the interview is, any experience

kingstreet

Why isn't this FA offering to handle your new Barclays mortgage?

You don't have to go direct to port a rate. He could also ensure the case would be acceptable to the lender before it is submitted, hence saving time if it won't be by having a plan B in place...

lowtidesurf86

Unfortunately the FA was away on holiday when we found the property, so I have already started the process, have the meeting with the bank on Tuesdays and dreading them picking my bank statements apart,
As a back up the FA is going to look at other lenders, he is more then confident I can get a mortgage, I'm just worried about not getting excepted at the Woolwich and having to pay the 3% ERC.

Thrugelmir

lowtidesurf86 wrote: »

dreading them picking my bank statements apart,

That's not the object of the exercise. It's to identify any activity that cause concern from the lenders perspective when processing the application.

lowtidesurf86

Ohhhhh, ok there appears to be some confusion then, I've been reading in the papers that they will be looking at how much food and cloths you buy, how many times you eat out, go to the pub etc etc, I thought it would be obvious that if we couldn't afford to go out after the mortgage came out we wouldn't.

kingstreet

lowtidesurf86 wrote: »

Ohhhhh, ok there appears to be some confusion then, I've been reading in the papers that they will be looking at how much food and cloths you buy, how many times you eat out, go to the pub etc etc, I thought it would be obvious that if we couldn't afford to go out after the mortgage came out we wouldn't.

Best ignored. Scaremongering twaddle.

Most lenders use ONS averages, they don't check to see you've been eating only beans on toast for the last three months!

Komorebi

Hiya

It's difficult to say for sure as mortgage interviews can differ widely, but I recently got a mortgage with Woolwich as a first time buyer and they asked for the exact same evidence they asked you for. Honestly those bits of evidence took up a very tiny part of the meeting. For the payslips and P60 she just scanned them in and gave them back, and used the payslips to see what I was paying per month for student loans. For the bank statement, she asked which payments were for rent and circled them, and then scanned the sheets and gave them back.

That was it really, no asking why I spent £30 at Homebase or anything like that! (I had actually prepared all that information in advance and was a bit disappointed she didn't ask!) She didn't spend a long time looking at the bank statements, but of course she could have been skimming them for payments like gambling etc and just not found any.

Like I said, I'm sure all the interviews are a bit different, but asking for that evidence isn't necessarily a sign you are going to be taken to task for living comfortably . My experience in mortgages is limited to that one so other people on the board are a lot more knowledgeable than me, but I would say if you are worried, maybe work out how much you would need to live: in an emergency, fairly comfortably, lavishly; then if you do get blindsided with a question, you can be honest and say that while you've been a bit spendy recently you can easily curb your outgoings by £x amount.