First Direct Mortage Advisor says mortgage affordable but their underwriter says no

stella1w

Long term, more than 25 yrs, First Direct customer. All products with them, good credit history, good job, tons of equity in house, seeking additional borrowing for loft extension which will add value to property.
Go through application with their mortgage adviser who says I I meet affordability.
However, their underwriter says no due to high childcare costs. Mortgage adviser said the borrowing was affordable even with these costs. Plus they will halve in sept, date of drawdown, when youngest starts school.
Underwriter wants evidence. I can provide payslips to show what I am currently paying my carer eg. Her rate of pay and a letter confirming her reduced hours from sept. But it seems underwriter wants track record evidence eg three months of the lower payments which I wouldn't have till December by which time the current good rates might have gone esp post Brexit and the loft extension would be delayed by a year.
Any advice appreciated.

amnblog

Unfortunately, the mortgage adviser does not sign the cheques.

Find another lender who wants your business.

ACG

As amn says, it is the underwriter who has to put their name next to the loan.

The underwriter has asked for proof the childcare costs will reduce, ask what they want, see what you can get and go from there - or find a new lender. It is the underwriter who is the boss so to speak.

stella1w

I guess I am surprised because the mortgage adviser and underwriter are both from First Direct so surprised that first says affordable and second not. They won't be specific about what they want except to say, evidence, track record and history. Common sense says no one will pay for childcare for the time their children are in school!
V disappointed due to decades of customer loyalty to FD.
Also they were offering a lifetime tracker which is my preferred option.

ACG

Go back, advise them of your childs age and that they will be starting school. At that point you will only need child care between the hours of x and y and so based on the hourly cost, it will reduce to £x per month.

Forget the advisor, they will say whatever as it appeases you, it is also not their decision but they should know their criteria as well as any underwriter.

You have had a hurdle put in front you. As you say, common sense should prevail, but if the FCA walked in and picked up your file and asked the questions, they could not say common sense dictates this, they need something to put in their file. Some lenders may be happy with an explanation others may want something more concrete - a letter from the school confirming your child has been accepted there maybe?

stella1w

I can evidence current hourly rate of childcare, plus child's school start and his age. I can get a letter signed by me and child carer that hours from September will be x. Obviously before the actual start I can't show history! Is this something the financial ombudsman would take an interest in? Or is it all down to the discretion of the underwriters?

ACG

Im not sure they would, but you would have to submit a complaint, wait between 1 and 9 weeks before you could go to the ombudsman. It would be easier to find a new lender.

HSBC/FD do not deal with brokers in the main so its hard as we do not know their processes. But normally there is a way to work through things but they could be different.

Thrugelmir

[QUOTE=stella1w;70369499Or_is_it_all_down_to_the_discretion_of_the_underwriters?[/QUOTE]

Underwriters work in accordance with set internal lending policy. Any discretion underwriters are allowed is restricted to the grey on the margins.

questionss

Don't forget holiday childcare will need to be considered too. My preschooler is in childcare 2dAys a week at a cost of £183 per month - this is subsidised via the 15hrs free. Once he starts school he will be in before and after school club twice a week and will need 2days childcare every holiday bar about 4weeks we can cover between us. This is £29 per week for 38weeks in term time and about £70 a week in holidays for about 9weeks. This averages as £144 a month - a saving of less than £40 a month. They may be used to similar situations and will want you to consider childcare year round costs.

stella1w

Yes, I have factored in wraparound and holiday care. Gave a clear breakdown to the adviser