Cooperative mortgage declined :(

XXNaomi

I am currently wanting to buy a house worth £351000 with a 10% deposit (i.e. needing a 315900 mortgage) over 35 years.

My 2 questions, as a first time buyer who has been declined in November 2016 and who has only paid a business tax bill of 8760 yesterday but has not been self employed since February 2016, are as follows:

1. when can I apply for another mortgage?
and
2. who is likely to accept me at a reasonable rate of interest?

Please see below for more information.

I was declined for a 2 year fixed rate mortgage of 1.94% payable over 35 years through the Cooperative bank in November 2016 and this was for a property worth 197000 and I was going to pay a deposit of 10% (i.e. a total mortgage of 177300). The reason stated for the decline of the mortgage was 'we have to be satisfied you have a sufficient amount of disposable income from your monthly net salary. In this particular case, the information contained in your application shows that the mortgage you requested, together with your existing/remaining commitments, may over commit you financially.'

I am confused by this as I have an income of 98,000 with one loan with monthly payments of 383 a month and my student loan (500 a month) and no other loans. I live with parents so have no rent or utility bills and otherwise have some general expenses such as car insurance, mobile telephone bill etc. Also they went through my income and outgoings when they offered me a mortgage decision in principle which stated I could borrow up to 440000.

I called the bank and they stated that I had some 'account mismanagement'. I asked for further information but they said that this was the only information they had from the underwriters and advised me to contact Experian. I signed up with Experian and my score was good and it still is. They stated that my credit was good and there was no reason that they could see why I had been declined. They felt that this may be connected to my business but they were unable to see this information. I was self employed for 2 years until February 2016. I was meant to pay my tax bill on June 2016 but only paid part of it and was left with a 8760 bill which was then paid it bit by bit at a rate of £200 a month. But I increased the payments and managed to pay this off yesterday in full. I tried to obtain a business report from Experian however when I applied for one due to technical difficulties I could not do this.

I am currently wanting to buy a house worth £351000 with a 10% deposit (i.e. needing a 315900 mortgage) over 35 years and would like to know when I can start looking at applying for mortgages again and who would be the most likely to accept my application?

Many thanks and God bless

ACG

I am struggling with your post a little.
Could you answer the questions below? One/2 word answers are fine.

Are you employed or self employed now?
How long have you been employed/self employed for with your current job?
-If self employed, how many self assessments do you have?
-What were the last 2 income amounts on there? (ie PAYE + Divs)?
-If employed, how much is your annual income?

Forget the credit score, are there any negative markers on your credit report (ie red or amber)? I
- If so, what negative markers are there? (late/missed/defaults)
- What are they for and when were they registered?

XXNaomi

Thanks for your reply.

I've been employed since February 2016 and I earn £98000.

My credit report is all green however I managed to get through to the person who dealt with my mortgage application and she said it was declined due to mismanaged accounts as I had returned direct debits, unplanned overdraft fees and she also said there was a payment to a debt collection agency.

Basically I had a silly dispute with Virgin who provided my internet as when I moved they were meant to change my internet over to my new address but they didn't tell me that this wouldn't be possible so I disputed the charges and stopped paying but when they sent me the debt collection agency letter I paid the bill to virgin directly (and not through the debt collection agency) in about September 2016. The total debt was under £15. The unplanned overdraft fees and return direct debits were an oversight at the time. It has happened 3 times in the last 6 months and the last unplanned overdraft fees were in December 2016.

All of the above does not seem to appear on my credit report but she said she had seen it when I supplied my bank statements.

She encouraged me to try again as she said that the Cooperative were a strident lender and another firm may be more lenient.

I was going to try the post office or Tesco bank. Any thoughts?

ACG

If there is nothing on your credit reports or bank statements you may be fine. I would not really want to comment without seeing everything first hand though.

Dont forget, you will need to declare the declined application on fuure applications where asked. So it may still crop up.

Whistler23

Also, if you haven't you need to check all the agencies. Equifax, Experian and Call Credit.

Some creditors do not report to all agencies. And likewise, some agencies are quite frankly crap. I would think that most mortgage lenders will look at all three agencies, and at the very least two of them. One a main for the actual check and then another to confirm identity.

ashp_2

I would suggest you get a mortgage broker so you can be matched to most suitable lender. As the post above says you should check your other credit reports also (You can do this for free just register with Clearscore & Noddle to check the other two you have not checked) Any issues with Virgin are likely to be on your Equifax (Clearscore) report rather than the Experian one.