provisional morgage offer keeps on reducing

runciblespoonfed

I am a first time buyer in Merseyside with 5K deposit now wanting to buy a flat for £78,000.

Originally I was told that I should be OK for properties up to 95K, but each time I have tried to move on from a provisional morgage offer they have reduced it by 10,000.

I thought I had to be safe at 78K but today once again I have been told I cannot have the full amount. My credit rating is fine and no problem with survey. Is it just me or is anyone else being messed around like this?

Pixie5740

How deposit do you have, £3,900? Are your Mortgage in Principles from the same lender? Have they carried out a soft hard search of your credit files?

moneyistooshorttomention

Was the amount you were promised as a provisional mortgage down in writing? or was it just what someone said to you verbally?

kilby_007

A friend of mine has experienced the same. Can't remember who the mortgage provider was (maybe Halifax?) but he did a couple of quotes (one last week, one a couple of months ago) on their mortgage calculator with exactly the same details. The results fell from 420 ish to 380 ish so about 10%. Could it indicate that they're trying to prevent bad debt/defaults in the event of an interest rate rise? I know a lot of people are getting huge mortgages that they would struggle with if the interest rate went up by a few %. Maybe they know something we don't...

Crashy_Time

Interest rate rise, house price crash, continuing bubble, take your pick, but it`s the banks that call the shots on how much most people can spend.

leanne12345

We also had a 5k deposit and got a mortgage in principle from Barclays for £80,000 so found a house based on that. When we came to put the full mortgage application in they reduced the amount they would lend us to £40,000!! We used a broker who got us a mortgage for the 80k that we needed through Natwest the same day. I would use a broker if I were you. Good luck!

Thrugelmir

runciblespoonfed wrote: »

I thought I had to be safe at 78K but today once again I have been told I cannot have the full amount. My credit rating is fine and no problem with survey. Is it just me or is anyone else being messed around like this?

Lenders can adjust their internal policies at any time. They are not fixed in stone.

marksoton

Lenders have a finite pot of cash at any given time. This means they'll adjust their risk profile to match.

You're best bet is a decent whole of market broker.

alan0356

Lenders mortgage calculators can only give an indication of mortgages available based on the information you input - if your income is made up of basic salary of say £20,000 pa with overtime of £5,000 pa and you input £25,000 as main income and do not provide the correct breakdown the result will vary as lenders may or may not take 100% of the overtime figure - most lenders take 50% of the annual figure. Also the term of the mortgage has an effect on maximum mortgages - ie by extending the term from say 25 years to 35 years will increase mortgage available ( subject to ages etc ). You may also have £2,000 outstanding on credit cards which you intend to repay before mortgage starts - but this will be included in outgoings on credit search if lender / broker is not advised that the balance is to be repaid.

Always use a mortgage broker and advise them fully of the real breakdown of your income, any loans that you have ( if not declared they will be found on credit search and reduce mortgage amount ) any intention to repay loans or credit cards etc - do all this and you should be able to obtain a true maximum figure for a mortgage.

Also lenders do change their credit scoring throughout the year dependent on whether they want new business or want to offer higher loan to value mortgages at that time.

Dependent on income and circumstances and loan to value there can be tens of thousands pounds difference to what lenders will lend.,

I am a mortgage broker and this reply is for information only.

Crashy_Time

marksoton wrote: »

Lenders have a finite pot of cash at any given time. This means they'll adjust their risk profile to match.

You're best bet is a decent whole of market broker.

http://news.sky.com/story/deutsche-bank-why-we-should-all-be-deeply-concerned-10596962

kingstreet

Did you enter ground rent & service charges when you first started?

Are there now ground rent & service charges if you didn't?

That's one reason affordability changes.