BARRATT homes cap on mortgages? help please.

emilyleigh44

Hello,
Me and my partner have recently reserved a plot at Barratt homes in durham, we chose to have our mortgage through Nationwide through a personal mortgage advisor ,we have our agreement in principle and are all ready to apply fully, until Barratt homes told us at our last meeting that there are rules where the bank has a limit on how many mortgages they can sell for one area in Barratt homes, due to a cap placed, the lady then gave us a number of another mortgage advisor who 'she recomended' and used a hour of our time frantically calling them, we later rang the bank worried to ask and they said no way is that true, that they wouldn't ever cap mortgages for certain areas and they would only ever decline a mortgage if the client did not meet criteria, they also told me to ring Barratt homes direct HQ and ask them, which i did he backed up the sales lady.

very confused as Barratt homes say they are full up on nationwide mortgages and that we will just be declined,

is this anything anyone has heard of? or knows anything about?

thank you.

boliston

I would not ever use a mortgage advisor recommended by a developer as there are almost certainly backhanders involved.

goodwithsaving

Sounds like a load of rubbish to me. Proceed with your chosen lender and await the outcome. Disgraceful that they seem to be lying to you. I wonder how many buyers they try to swindle more money out of this way.

AdrianC

So you've called the lender, who are perfectly clear that there's no problem and they'll be happy to lend, but you don't believe them?

Adj33

I had the same thing with Halifax and couldn't buy from A new build site near me due to amount of mortgages they had approved on the site. Halifax confirmed this, maybe this is same here with nationwide?

Jon_B_2

I have no idea if it's true, but when you think about it - it wouldn't be that surprising.

If you are lender on a new build there is a degree of risk compared to a second hand house as the value is dictated by a lender - even though valuations take place it is well known that some house depreciate quite quickly.

If you were to lend to say 75% of a 100 plot development and they all depreciated by say £5k in the first year - you are looking at quite a significant exposed risk.

john_white

How many mortgages have Nationwide given on Barrett homes in the area, and what is the cap?


They won't be able to answer as there is no cap. How would it even work, the life cycle of a mortgage application is long, at what point does the cap kick in?

mrginge

Lenders may restrict their exposure to new developments.
Nothing unusual about that.

Jon B's assessment is pretty much the reason for these limits.


So what barratts have told you is sometimes true.
Now its entirely possible that sales lady is spinning you that line to get you onto one of their own advisors. But its also possible that the person you spoke to at nationwide is unaware of these limits (if they are appropriate in this case).
If you are confident in the information received from nationwide then proceed, if not then seek further clarification from them.

chanz4

I have also come across this before, it is about risk