Mortgage declined

suekerr14

We have recently applied to consolidate our debts into our mortgage, we have a reasonably low mortgage 70k and have a lot of equity in our house, however we have applied to borrow an extra 40k - both of us are working with good salaries so we can easily afford it but have been declined. The mortgage advisor advised us to take a look at Experian to get an idea of why this is. I did take a look and according to Experian we have an excellent credit history with 6 positives and only one negative, this negative being owing money on credit cards and a loan. We have since spoken to another mortgage advisor who has no idea .....neither do we! why it has been declined. We are now in the process of applying to another lender but are very hesitant about being rejected again! Can any one throw any light on to this?

glentoran99

You have 40k worth of debt? No lender is going to give you another 40k, You've been declined because there is no guarantees you wont just run up the 40k debt again, therefore paying an extra 40k on your mortgae and owe another 40k, the mortgage advisor should know this.


The affordability calculation would take into account the 40k owed, can your salaries afford an extra 40k on the mortgage and the 40k debt?

ACG

Ignore glentoran - there are lenders who will do it.
Last month I completed on one with £65k worth of debt.
3-4 months ago I completed one with £70k worth of debt...the clients income was £35k combined on that one.

Its worrying that your broker asked you to check your credit report AFTER the application was declined and not before the application was made.

There are 2-3 lenders who are very good for debt consolidation, a couple are shockingly bad and the rest fall somewhere in between and will depend on your incomes and the amount of debt as well as the rest of your expenditure.

Thrugelmir

suekerr14 wrote: »

I did take a look and according to Experian we have an excellent credit history with 6 positives and only one negative, this negative being owing money on credit cards and a loan.

How you manage your personal financial affairs is very important. Lenders have access to an array of data from the CRA's. The underwriting process profiles you as a potential borrower and the risks you pose. Being a pay cheque away from a slippery downward slope is far more important than any amount of credit history.