Mortgage withdrawn 2 days before completion and exchange

mustafa786x

Afternoon Guys,

First time poster and home owner.


Background on this case,
DIP accepted offered a mortgage of £201,000 borrowing at 88% LTV
Offered on property sale price £150,000 with 88% LTV.
Accepted all is well,
Mortgage documents sent, payslips, bank statements, everything required all ok
Suppose to complete and exchange tomorrow,
called the solicitors yesterday to confirm everything and they called me back at 3pm stating that nationwide has refused to release funds due to a failed credit check?

I haven't taken any credit out since the DIP or application, my credit score has actually increased from 933 to 963 in this time,
They have increased my credit card limit from 11,000 to 13,800 nothing owed on it?
No missed payments?
Unsure why I have failed credit score?
They have offered to lend to me 88% at £201,000 I have chosen to purchase at a much lower property.

I am only taking out a mortgage of £133,000 not £201,000 well within my borrowing amount

I have spoken to the broker who said that the underwriter for NW will review this within 24 hours, this was yesterday at 4pm.
I am struggling to understand why they have withdrawn the offer this late stage 2 days before competing?
:(

What to do if they refused to lend?

kingstreet

Find a new lender?

mustafa786x

Within 24 hours?

DoaM

Were you really to be exchanging and completing on the same day? (Note the order).

This means that the exchange will probably not go ahead and you'll have to find another property. Unless the mortgage gets sorted today ... have you checked with the broker/NW today?

kingstreet

mustafa786x wrote: »

Within 24 hours?

You haven't exchanged contracts yet, so the 24 hours thing is no longer viable.

If you have to find a new lender, the chain will have to wait until you can get back to the position you had reached before.

Ignore the 933, 963 stuff from Experian. That means something only when they start lending money. Something in your financial make-up has changed which has caused Nationwide's opinion of you as a borrower to change. Hopefully, it won't be too much of an issue and your offer will be re-instated.

JohnnyZee

Perhaps this is a blessing in disguise. It is very risky business exchanging and completing on the same day. People have had nightmares. Search the forum and read the stories. Since you may have to delay your timeline/get a new lender, it may be better to leave at least a gap of one week between exchange and completion. Is there any urgency to complete ASAP?

Surrey_EA

Do you actually ever have a mortgage offer, as opposed to just a DIP?

It seems unlikely to me that exchange and completion was ever going to take place tomorrow.

Cardinal-Red

Kind of a mini hijack here - is it normal for a lender to do a second credit check once they have made an offer?

Is it like the solicitors "final check" on the Land Registry etc?

I only ask because, unlike the OP, I have bought some stuff on credit in the period between offer made (from HSBC) and completion (end of this month).

Surrey_EA

Cardinal-Red wrote: »

Kind of a mini hijack here - is it normal for a lender to do a second credit check once they have made an offer?

Is it like the solicitors "final check" on the Land Registry etc?

I only ask because, unlike the OP, I have bought some stuff on credit in the period between offer made (from HSBC) and completion (end of this month).

I do not believe it is normal, but kingstreet better placed to answer.

From the way the op has worded their post I suspect all they had was a DIP, and never got as far as a full mortgage offer, so there was no offer to be withdrawn.

eddddy

mustafa786x wrote: »

DIP accepted offered a mortgage of £201,000 borrowing at 88% LTV
...
called the solicitors yesterday to confirm everything and they called me back at 3pm stating that nationwide has refused to release funds due to a failed credit check?

I'm no expert on this, but was it definitely the Experian credit check?

They'd have credit checked you for the DIP, but they wouldn't have seen your bank statements (or payslips etc) at that stage.

Could it be they didn't like something they saw on those?
e.g. They've spotted a 'regular outgoings' that you hadn't mentioned, or gambling transactions.

saajan_12

mustafa786x wrote: »

Within 24 hours?

You haven't exchanged so you're not tied to the 24hour deadline. Exchange & completion will have to be pushed back until then.

JohnnyZee wrote: »

Perhaps this is a blessing in disguise. It is very risky business exchanging and completing on the same day.

How? in this case it's better for the OP.. the lender isn't tied in at the point of exchange, and can withdraw the offer if they find new info etc. So, if OP had already exchanged and then the lender withdrew, then OP would be unable to complete and lose their deposit / pay costs to the seller.

For OP, next time do the same, just try to leave booking things for completion until the day of where possible or be prepared to lose any money spent if exchange/completion don't happen again.