Mortgage Application Denied

andyse13

Hi Guys

Really p****d off to find out my Mortgage application with the abbey national has been denied 6 weeks into the buying process. Although they took the liberty of doing the survey and charging me first before letting me know this!!!

I have several queries that you may be able to help me with:

1) My mortgage advisor has said the reason given was "Non disclosure of credit". I have tried to contact the abbey national direct but they keep refering me back to my finance advisor for more info. I have checked my credit files online today with Equifax & Experian which match the outstanding credit I declared on my mortgage application and nothing else. Can I get more specific info from anyone as I reckon a mistake has been made............

I also do not understand the fact that a credit search was made at the time of my initial application on the same day as getting an agreeement in principle from the abbey. Why have they left it till now to decide there is a problem???????

2) Since making the mortgage application I have had a number of searchs added to my credit file from various finance companies as I am also setting up a loan to cover moving costs/deposit (I know this sounds dodgey but is on the advise of my ifa) Could this have caused the problem??? I do not see why as I havnt actualy accepted any loan offer or started making any payments yet?????

Your comments would be greatly appreciated........

herbiesjp

Abbey have done a similar thing to a coupel of my clients recently - not the same excuse, but waited for a long time to then decline the application. There was no changing their mind.

I would suggest looking at alternatives

andyse13

I apreciate ill be taking on the big boys - but surely if I can prove I have fully disclosed my credit I can appeal against it?????

MarkyMarkD

I don't think that you HAVE fully disclosed your credit position, if you fully intended to borrow money to meet your deposit and moving costs.

One of the normal questions on a mortgage application form is to ask (or require that) the deposit comes from your own funds. If (for example) you are borrowing 95% on a mortgage and the other 5% is coming from a loan, you are a far worse prospect for the lender than someone who already has the 5% in cash and is genuinely only borrowing 95%.

If you really don't have the deposit, it is duff advice for the IFA to say "borrow 5% on a short-term loan and 95% on a mortgage without telling the mortgage lender you are going to borrow the other 5%". He should be recommending, IMHO, that you borrow the 100% on a 100% mortgage and be honest with the lender.

Most borrowers have enough difficulty meeting the payments on a 95% mortgage, without the (by definition huge) repayments on the other 5% over a shorter period.

Michel_Z.

I agree that if the remaining 5 % is not your own money, but a loan for example you are not in a good position to get approval or even to negotiate later on!

heather38

northern rock offer a 'together' morgage where you have a 95% morgage and a 5% loan this means you get a better rate of interest and both are charged at the same rate over the same length of time 25 years, but there are no penalties attached to the loan for paying it off early

payless

Ask the adviser for a copy of the application - my guess his he had to input online to abbey
Q34 - Please state source of deposit

what did you say/ he input
---

NR - yes they ( and others) do a mtg + loan - rates are not that keen as compared with other 95% mortgages ( or even in some cases, other 100% schemes)

Their products do seem popoular with many advisers - their commissions are often higher than most ( assume no connection)