HSBC mortgage: a lost cause?

rubru5

I know I am raking up old ground here, but I could not find any recent posts on here about this subject, so forgive me.

My husband and I are first-time buyers and have been given an AIP from HSBC - I have been told the reality of this is that it is meaningless - for borrowing £270,000 for a £300,000 property - 90% LTV. We had our interview with HSBC to do the application 2 weeks ago and have still not heard anything. We have both banked with HSBC for 14-15 years - not sure if that makes any difference?

We have a joint income of £57,000 annually, no outstanding credit - with the exception of my student loan - no dependents and v.low outgoings. I am a teacher on a permanent contract and my husband is a manager with Tesco. I have three months' UK payslips, but my husband only has two months' worth, but a full contract, detailing his annual salary from Tesco and HSBC said this was fine. Our Experian reports - again, I hear these are meaningless - are in the 'excellent' range. We also have a business - the accounts for this being held with HSBC - which makes a good amount of money monthly, but as this is a new business, that isn't considered, I don't think?

The issue we have is that we were originally given and AIP by Nationwide - a far easier lender by all accounts - but as we lived in Dubai for 10 months, having returned to the UK in July, this is a problem for some of the lenders who'll lend more and Nationwide have now said no to our application on these grounds. HSBC have said this is not a problem - although they have requested our Dubai payslips which we gave them - as have Santander, who we were approved with for an application on another property which fell through, but they will not lend us enough for this new property.

The other option we have is putting down a £45k deposit and going with Halifax/ TSB who will lend us £255,000, but that leaves us with just money for stamp duty and solicitor fees and that is it, so that's really a last resort. Equally, we do not want to mess the vendor around by waiting for HSBC if they will just say no...

What do you think are our chances of being lent to by HSBC? Really appreciate any advice/ experiences shared. Also, is there any way to appeal a decision if it comes back negative?

Many thanks in advance

Thrugelmir

Given the set of circumstances you present. Your application is far from straightforward. The mortgage market has changed in the time you've been away. Much depends on the underwriter reviewing your case and whether it's business HSBC wish to conduct.

Rich2808

HSBC aren't the only provider - even if it may be more convenient as you bank with them.

Perhaps you should try a broker or do you have a small local building society in your area that may give you a more personal service.

Some providers are so big - that if your case isn't simple it just can get lost in the backlog/bureaucracy.

rubru5

Thanks for the prompt replies. All the building societies I have contacted have the same rules as Nationwide about those who have resided outside the UK in the past three years: a flat no.

billchecker1

Your situation doesnt seem that dissimlar to mine, looking at salary and LTV. Depsite the horror stories mine went through fine and HSBC are a great lender with great rates.

The underwriter told me that they like public sector employees and that seemed to do the trick as were borrowing 90% and at the top of our affordibility.

So dont worry too much and wait tos ee what they.

GoldenShadow

We have joint incomes similar to you, one also in Tesco the other public sector. We have low outgoings and my broker steered us clear of HSBC, so I think it depends on the nuts and bolts of your situation really.

270K on that income seems quite a chunk to borrow, we borrowed 3.5 times income with 10% deposit as didn't feel comfortable going higher. Risk averse finance worker for you! Also not sure how jobs are going to go down in Tesco for the foreseeable. I would wager certain jobs are safer than others which is another reason we didn't want to push ourselves too far.

Have you got a broker? Ours was brilliant (and cost nothing, takes commission from the lender only) and they know much more than ordinary people about the best lenders to place people with.

billchecker1

Personally i think people are over thinking things and creating self induced fear. They DO lend to people!

Most brokers dont offer HSBC so they have nothing to gain!

The amount that we borrowed was a little over 4.5 X our joint income and we were approved. We did our main banking with Lloyds as well.

The advice i would give is to make sure you know exactly where your money is going. I keep spreadhseets with all our income and outgoings on and i took this with me in branch and this was given to the underwriter.

Mudd14

I borrowed the same amount 270k with a 30k deposit through HSBC, I had an AIP.
It rejected in the full application based on affordability but then accepted when speaking with the underwriters and declaring additional income that I left out originally. Our income is about double yours but by the sounds of it my net outgoings are also about double yours.

You wont know until you try by the sounds of it!

swindiff

I earn 40K a year and my partner 15K, we have a BTL property which also brings in £300/month surplus after the mortgage. We have £5k on a 0% credit card and £5k in the bank. A lease car of £180/month, then just standard bills that everyone has, food, utilities etc. Both have excellent credit score with all agencies and HSBC turned us down for a £100k mortgage on a property worth £165k on the grounds of affordability. I was a bit gobsmacked to be honest. Went to Nationwide, no problem at all.

GoldenShadow

billchecker1 wrote: »

Personally i think people are over thinking things and creating self induced fear. They DO lend to people!

Most brokers dont offer HSBC so they have nothing to gain!

The amount that we borrowed was a little over 4.5 X our joint income and we were approved. We did our main banking with Lloyds as well.

The advice i would give is to make sure you know exactly where your money is going. I keep spreadhseets with all our income and outgoings on and i took this with me in branch and this was given to the underwriter.

No one is saying they don't.

But the issue is, no one seems to know what qualities HSBC are cherry picking for. So it depends if you want to waste your time hanging around to see if they will lend to you or not. A lot of buyers (and sellers) don't much like being kept waiting let alone for a big fat no that means you have to start again having created fear in your seller that you can't get a mortgage.

HSBC rates weren't enough to make me want to push my luck and risk losing the house, which is why we went with a considerably more straight forward lender. If it suits circumstances then fine, but for a lot I know it doesn't.

rubru5

Thanks again for all the replies - we really appreciate it

RE amount, I know it is a lot, but we live in Buckinghamshire, so prices are astronomical and just going up and up! Bank have said affordability-wise that it is very doable and that they are happy. Apparently underwriters are happy so far - this is what we were told today - but we will have to wait and see. I pushed them to try and speed it up and initially they said no way to a valuation being done in the next two weeks, as requested by the vendor, but when I said it wasn't really acceptable or a viable timeframe given how houses are being snapped up and vendors know someone else would bite their hand off, I got an email shortly afterwards explaining that they had moved the second meeting to this Friday and the valuation would take place early next week. Does that sound hopeful or should I still expect the worst? I have had some much disappointment on the house-hunting trail that I've gone from being an eternal optimist to a hopeless pessimist - I guess as everyone does.

We have tried to use a broker, but he is extremely busy, so that has been very slow. One unscrupulous agent in our hometown actually accepted a lower offer on the previous property we wanted to buy because we wouldn't use their broker who cost 600 quid. Outrageous.

GoldenShadow wrote: »

270K on that income seems quite a chunk to borrow.

Have you got a broker? Ours was brilliant (and cost nothing, takes commission from the lender only) and they know much more than ordinary people about the best lenders to place people with.