HSBC application declined - what next? Santander fastest alternative?

horz

We applied for a first time buyers mortgage with HSBC (1.99% for 2 years with 90% LTV) on May 5th following recommendation from our mortgage broker, London and Country. We found out on 10th June that our application had been declined after reaching the final stages of checking (with the underwriter I believe). This was surprising and very disappointing, as the broker had assured us throughout the process that we were borrowing well within the lenders limits, and met all other lending criteria (obviously not!).

Our contact at the broker said that they too were surprised we had been declined, and he had his director talk to the lender for further info. The details were not clear but apparently HSBC identified an additional £285 monthly spend from our bank statements, which appears to be the only thing that may have caused the rejection. So it seems we may have fallen down on affordability. I have asked whether increasing our deposit will help (we have extra savings but not enough to bring us into the next LTV band), and am waiting for a response from HSBC.


What are our chances of HSBC changing their minds? Is there anything else we can do to try and save our application? From what I understand this is very unlikely. I am quite worried that the seller of the house we want to buy will look for other buyers, as we have not made any progress in over one month since offer and she was already nervous that no survey had been done, as HSBC carry out this out after the offer. We really don’t want to lose the house, so are looking to act as quickly as we can to have an alternative mortgage agreed.

Will the HSBC declined application have any effect on future mortgage applications?

The broker has recommended a Santander 2 year fix @ 2.49% due to the fact that Santander have an average 18 day turnaround on mortgage applications. Any reasons not to go with Santander, or does anyone know of a lender with faster application process? All of our payslips etc required for mortgage application are still valid so that at least should speed things up a bit.

Is there anything else we should be doing now that we have had the mortgage declined?

Glover1862

I would recommend Virgin money, valuation is instructed on application and my offer was with me in under two weeks, their website says about 12/13 days turnaround, also, good cashback deals which all helps. They also have good retention deals when your fix comes to an end.

Coventry building society are good as well.

horz

Thanks for the reply, it's good to hear your application was processed quickly. Did you apply to Virgin through a broker?

How do you know that Coventry offer a fast turnaround? I was drawn to one of their products but could not find any information on how quickly they could process an application.

mrginge

I wouldn't take recommendations from individuals on here.

csgohan4

one lender for one buyer doesn't mean it is the right one for another.

Glover1862

CBS I can only go by what two brokers have said and my phone conversation with them, they seemed pretty clued up.

Virgin money I can comment on my own experience and you can look on their website as they publish service level figures. I went through a broker so search for virgin money intermediates and you'll get the info.

As for not relying on personal recommendations, a broken can also have their own interests, my last broker kept recommending one lender, think it was Accord, could have been Paragon who happen to offer the most commission when I checked. As long as you do your own research you'll be in a better position.

[Deleted User]

Nationwide, i went into the branch on wednesday, had the survey on friday and had a text friday night saying my offer is being sent out...