Depressed, mortgage sourcing!

fairyloveheart

Reserved a property on a new estate - hope to do help2buy equity loan. Gone through a broker, but am having difficulty getting a mortgage

Nationwide have referred us - Which I think means to assess more thoroughly, however they want the 1K fee up front and we may not get the mortgage and then lose it which seems unfair!
TSB said no (I thought they liked to say Yes )

Basically situation is we want a mortgage of 220K. Have a 35K deposit ourselves and help to buy funding of a further 60K.

Issue is that we have 25K of debt currently which will be all cleared if we move as we have enough equity to do so, but it is like they take that into account ow even though it will be gone. Credit score is 760 for me and 895 for husband partner. Mine is lower due to the current balanced of unsecured lending. Have been late on a few payments on a next account over the years but that's the only other thing that shows negatively.

Salaries are 38K and 32K

My parents have offered to pay off all the debts now but broker says it won't improve the credit rating quickly as takes some time to clear - which is the other annoying thing. Why are the debt figures so out of date. One loan which I only owe 1K on is sitting there at 2800 which was the position months and months ago.

Just feeling depressed. Broker is still looking so haven't lost all hope but just feels rubbish

Not sure why I am posting really just to vent.

mrginge

why have you got 25k of debt when you have 35k lying around for a deposit?

kingstreet

Nationwide refunds the product fee if it declines the case.

csgohan4

fairyloveheart wrote: »

Issue is that we have 25K of debt currently which will be all cleared if we move as we have enough equity to do so, but it is like they take that into account ow even though it will be gone.


The banks don't go on what ifs, they go on now and what it is. There is no guarantee you will clear the debt, only your word which is not good enough in this day and age. They are not lending to their mates, it's a formal business.


Credit score is 760 for me and 895 for husband partner. Mine is lower due to the current balanced of unsecured lending. Have been late on a few payments on a next account over the years but that's the only other thing that shows negatively.


The 'only other' thing is actually quite important and shows how poorly you have managed your accounts over the years and therefore a risk to lend money to.


Don't be fooled by the credit file number rating. They are not used by lenders, it's the history that matters, don't be lulled into a false sense of security. People have been rejected with scores of 900+.

Salaries are 38K and 32K

My parents have offered to pay off all the debts now but broker says it won't improve the credit rating quickly as takes some time to clear - which is the other annoying thing. Why are the debt figures so out of date. One loan which I only owe 1K on is sitting there at 2800 which was the position months and months ago.




Did you request your credit report at least 3 months in advance to check any inaccuracies or errors? I'm guessing no.

Seems you have a loan here and there and it adds up to affordability and hinders what you can actually afford. Therefore the arbitrary figure of 4.5x ones salary is actually a red herring. It's your outgoings that's becoming more important


Personally I wouldn't touch Help to buy with their restrictions. Have you had a look at them yourself as it's not free and you pay back the market value at the time of payback.

dustywarrior

Your situation is far from abnormal and you have a decent combined salary. Providing you have a half decent broker I wouldn't worry, I'm sure they will get you a mortgage.

Is the debt in both your names?

Thrugelmir

Where's the deposit coming from if you have £25k of debt?

Clearing the debt from the equity you have is simply kicking the can down the road. Doesn't answer the question as to why you are in such much debt. Not that lenders drill that deeply. Their concern will be they you'll simply run debt up again in the future. The easy way out teaches no lessons. Better that people learn the hard way for themselves.

Savings and debt doesn't sit in separate pots. All that matters is the net of the two.

GRBWA

Ignore all the moral ramblings from the usual suspects. Get yourself a broker and they will sort this out for you.

Landofwood

Thrugelmir wrote: »

Where's the deposit coming from if you have £25k of debt?

Savings and debt doesn't sit in separate pots. All that matters is the net of the two.

Thats a nice theory but is inaccurate.

Many lenders will accept your "savings" as a deposit even with large amounts of debt. The debt is simply factored into the affordability calculations.

Of course this technically amounts to borrowing a deposit, but it's not always looked upon as such.

Thrugelmir

Landofwood wrote: »

Thats a nice theory but is inaccurate.

Many lenders will accept your "savings" as a deposit even with large amounts of debt. The debt is simply factored into the affordability calculations.

Of course this technically amounts to borrowing a deposit, but it's not always looked upon as such.

Well you learn something new everyday. I look forward to being enlightened further.

GRBWA

You can "wink" all you like, fact is that mortgages are obtained with this kind of scenario.

I don't know what you do for a living and you may well work for organisations that take a dim view of people with a low net worth in a mortgage application but there are definitely willing lenders out there for this who calculate as per Landofowood's post.

Thrugelmir

GRBWA wrote: »

You can "wink" all you like, fact is that mortgages are obtained with this kind of scenario.

I don't know what you do for a living and you may well work for organisations that take a dim view of people with a low net worth in a mortgage application but there are definitely willing lenders out there for this who calculate as per Landofowood's post.

You are entitled to your personal view. This is an open forum. If you don't like my posts. Please add me to your ignore list. Simple to do. :beer: