TSB DIP declined

Akk223

Hi

I would be grateful if you can provide me your thoughts as to the following issue I have. Basically I am currently on a fixed term mortgage deal which expires in June this year with Aldermore. When I took out my mortgage product I had two defaults of which one has dropped off. The second one has been fully satisfied (last September and was for £900) which disappears from my credit file this June. The house I purchased required a lot of renovation work and therefore spent all my savings in doing the house up. In essence the valuation of the house has doubled but I did spend half of that in doing the house up. In essence the house has substantial equity. I was going to release some of this equity and buy the neighbour property as this is rented out and has a good yield. The deal for the purchase has been agreed between me and my neighbour.

In respect to buying the neighbour property I am taking out a buy to let mortgage which should have no issue meeting the mortgage requirements as I am purchasing this through a company and placing a large deposit released from my current property to purchase.

The difficulty I have is that I was hoping to take advantage of the low mortgage rates by remortgaging my current property. Having contacted London and Country they recommended me to take out a mortgage with TSB.

Before the DiP I disclosed all my circumstances to the mortgage broker. Other than the default mentioned above I have ensured all payments are met on schedule. Last November I did take out a credit card and a PayPal credit agreement both for the sum of £500 each. The reason for this was to use the money to pay for some items for the housetraining advantage of the 0% rate for 6 months. By taking these credit agreements my credit rating all of a sudden dropped from fair to very poor despite making payments on time for the set amount which is more than the minimum. I was hoping to clear both accounts in March this year when my bonus is paid in.

The issue was that the TSB decision came back as decline despite the mortgage broker telling me that the bank would not consider my default as it was fully paid and more than 3 years ago.

Can someone please shed some light.

Many thanks in advance

Thrugelmir

Akk223 wrote: »

In respect to buying the neighbour property I am taking out a buy to let mortgage which should have no issue meeting the mortgage requirements as I am purchasing this through a company and placing a large deposit released from my current property to purchase.

Funding the purchase with debt i.e. no injection of capital from yourself. May be a concern for the lender. When taking into account your entire credit history, i.e. a default which took some years to settle

ACG

Fittingcriteria and being accepted can be worlds apart.
What has your broker said? One lender declining you does not mean they all will.

The other issue you have is that a large percentage of lenders will not want to lend on a property when you own the property next door. So it is worth checking this beforehand also.

Akk223

Hi thanks for the replies

Basically the large capital is coming from my current home for which there is a mortgage on. The property has 50% equity available following the works carried out. The renovation works were funded by my savings rather than loans.

Akk223

The mortgage lenders which I have approached are happy to lend to purchase the neeighbouring property as they are not attached.