Mortgage AIP received but then want 35% deposit! What now?

Spazter

Hi all


I have sold my house subject to contract and had an offer accepted on a house buying. I have received an agreement in principle (AIP) from my bank only last Friday for more than enough to buy the house I want.


I went into the bank today to progress to full application but they can only offer me 65% LTV! :-(. They say there isn't any issue with affordability its my credit file that shows I was in arrears by 1 month on 2 credit card accounts. These were 17 months ago and only went into arrears for the 1 month each and have been caught up and on time for the 17 months.


What can I do now? How can they give an AIP and then give such a high deposit required? Surely this showed when then did the soft search for the AIP?


Is there places that will lend when arrears show that are 17 months ago? I do have some balances on cards to pay off but these will be cleared in total with the proceeds of the sale of my house but I certainly can't afford to put down a 35% deposit on a new house?


Has anyone had this and where did you go to secure a mortgage?


Going to one miserable new year now stressing over this! :-(

missmoose

Try a different bank.
Try a broker that can point you in the right direction.
Might be wise to go to a EA that you're not associated with and get their free consultation to find one that works with you.

kingstreet

Halifax 'Mortgage Promise', by any chance?

The full search at full application is much more in-depth and may result in corrective action where you have to reduce the LTV to 65%.

An experienced independent broker should be your next port of call.

An EA advisor? Chances are the service will be limited panel and a fee will be charged. Worst of both worlds...

Spazter

Thanks for answers :j. It's not Halifax but it is a high street bank. I was dumbfounded and shocked when they gave the amount of 35% deposit especially after having given me AIP only last Friday!

Which mortgage brokers am I best contacting? Am I going to be classed as sub prime due to the arrears of 1 month from 17 months ago?

Spazter

..........that moment when you realise an AIP means nothing ...................:mad:

pinksgirl

Don't say that!! I was hoping, approved AIP means at least the bank will lend you!!
(as opposed to last time when they said..no lending on your account)

I had exactly same offer, they can give me £168 k with 35% deposit..if I had £90 k I could have borrowed 10 more and bought a house .

Thanks
Pinksgirl

csgohan4

AIP does not mean acceptance, it's only on a full application a more indepth credit check is done and more accurate

Perhaps checking your credit files in advance of applying would have been ideal and seeing what a broker could get you.

ACG

There are a few lenders where an AIP holds some weight. But in the main, AIPs are not worth the paper they are printed on especially with lenders like Halifax where it is just a soft footprint.

the only ones worth anything (in my opinion) are the ones done with small building societies where it is a manual process.

csgohan4

ACG wrote: »

There are a few lenders where an AIP holds some weight. But in the main, AIPs are not worth the paper they are printed on especially with lenders like Halifax where it is just a soft footprint.

the only ones worth anything (in my opinion) are the ones done with small building societies where it is a manual process.

Never actually got an AIP before I offered on my house. Advised by my mortgage broker. You might not even get the same product come full application. Trusted his judgement and any issues the EA could contact him.

Glad I got a good broker

Thrugelmir

Spazter wrote: »

I went into the bank today to progress to full application but they can only offer me 65% LTV! :-(. They say there isn't any issue with affordability its my credit file that shows I was in arrears by 1 month on 2 credit card accounts. These were 17 months ago and only went into arrears for the 1 month each and have been caught up and on time for the 17 months.


(

Lenders will base their decision on your credit history over the past 72 months against their internally set criteria. Any form of arrears suggests potential financial weakness when combined with current credit commitments. Lenders are in effect assessing the probability of you making 300 (or more) monthly payments on time and without issue. Margins on mortgage lenders are low. Chasing delinquent accounts is very time consuming and costly.

Spazter

Resurrection of my old original post 😃.

Went to a whole of market mortgage broker who got us a fantastic deal with a much lower interest rate than the bank was offering. I should have used a broker from the start instead of wasting time with the bank which was my bank who I had my current mortgage with!

The mortgage and approval etc was completed in a week and valuation was straight away. We are now in our dream house and have been since beginning of March :j