Lending Shortfall

jdc23

I am looking for a bit of advice on how to proceed. We are now on day 38 of working with our broker to try and get a mortgage agreed. It’s becoming quite a long and painful process.

We are attempting to purchase a new build property with the Help to Buy scheme. We have checked our credit files and have no adverse history. Our broker has applied for two mortgages so far. The first application was with Halifax and was declined within a few days. The second application is with Natwest and they have granted us a mortgage but the lending has come up short of what we need. Originally it came up around £20k short, my partner then received a raise in her wages and we submitted this new information. The lending is now just under £7000 short.

The salary multiply we are being offered works out to approx. 4.3 times salary. Our broker is of the opinion that no other lender is likely to offer us any higher. Their only solution seems to be for us to find the shortfall ourselves and increase the deposit.

I know this is maybe impossible to answer, but I’m really not sure what to do. Should I push my broker to make another application or do we need to look at other solutions? I can provide all our figures if required, but don't what to make my opening post to long and complicated.

Thrugelmir

You are up against affordability hurdles. Your broker knows best.

Seems the best option is for you to switch to a beans on toast budget for a few months and increase your savings.

kingstreet

TBH I've participated in your other threads and by starting new ones instead of continuing existing ones it gets very difficult to keep up.

It's a bit like Bill Murray in Groundhog Day.

IIRC the last issue I raised was the difference in the data between your Experian and Equifax credit files here;-

https://forums.moneysavingexpert.com/discussion/5635591

and I got no response.

csgohan4

looks like your pushing things to the limit, either save more and look at reducing your household outgoings and reduce any debt you have

Voyager2002

Try negotiating with the vendor: house prices are declining at the moment so unless they have another buyer waiting they will soon have to reduce their asking price.

In terms of what you have posted about the salary multiple that house is far too expensive for you, and the purchase represents a terrible risk for you.

ACG

Thrugelmir wrote: »

Your broker knows best.

If an application is being declined on affordability, I am not sure the broker does know best. There is an affordability calculator, so unless the applicants did not disclose something or gave the wrong figures, then the broker has made a mistake in my opinion.

rhysadams

Its a hard one, your mortgage broker will know his stuff and of course, he wouldn't want to lose out on any fee's so its within his best interest to provide you with the right information from the start. Also, he is doing you proud by not applying for 5-6 different mortgages as this can have a negative effect on your credit rating.

My advice would be to see if you can borrow the money off family, however new rules on affordability is that you will need to provide a letter from them to say that this is the case. Even if it is a gift you will need the same sort of letter.

ACG

I'm not wanting to start an argument but I would hardly say they are doing him proud. I would say they are doing their job, I know there are brokers who would do something silly and apply as many times as possible.

I am hot and miss about whether they are doing a good job or not, but failing affordability is pretty poor unless there is a good reason.

Thrugelmir

ACG wrote: »

If an application is being declined on affordability,

I would consider a decline as a different matter to an amount that a lender will advance. As for any professional person. I prefer to err on the side that the vast majority do have their clients best interests at heart. As reputation ultimately is the solid foundation of any business.

amnblog

The other thread referred to by KS above indicates that our poster has a fluid situation with debts being repaid.

Affordability calculators are accurate by definition as the Bank Staff use them for their definitive position. That does not mean they are easy to complete correctly - they are not. I could give you a list of over a dozen elements that need consideration.

This simple answer here may be that the requested lending is simply not 'affordable'.

The person best placed to pull this out of the fire is the original broker.

jdc23

I just wanted to update and thank everyone for their help during our mortgage application, your replies on my various threads have been very helpful to me. I'm sorry if I started a few too many threads, it wasn't my intention to confuse. Sorry to Kingstreet, your replies have been very helpful to me and sorry I didn't reply in my other thread. I was out of the country for a while.

To update on the situation, we received our formal mortgage offer last week. We weren't able to increase our lending any further but a family member very kindly gifted us the shortfall so we have been able to proceed. Hope now to exchange contracts within the next fortnight.