Trying to get a mortgage with a 20k personal loan!

Stripeytiger2018

Hi all
I'm new here and looking for advice or to hear what others have experienced.
It's a long story so I will try and summarise. We are first time buyers.
Currently we earn no less that £2300 each month. Sometimes more because of bonuses.
We also get £45 weekly additionally.
The house we want to buy is a shared ownership house full price £220000
Our share would be 25% at £55000
rent £312 per month
Mortgage has been estimated before at £ 220
We have a 10% deposit. My partner was no adverse credit, I have an old settled default under £200 It's from 5 years ago.

Here's where it's tricky. My partner after a long discussion went and got a 20k loan 2 months before applying for a mortgage. He paid a lump sum off it and currently owes £23k. Repayments £322 per month.
We have phones on contract and fuel for work but no other monthly credit commitments. We spoke to a mortgage advisor who said it was still possible to get a mortgage with this loan but it is very risky (and stupid) in my opinion. He said he wouldn't let it effect us getting a mortgage. It was for a car so the car would have to go im thinking.

Ridiculous situation I'm very angry and stressed out of my mind at the moment. We applied through a broker to Santander who gave us a DIP and spoke to our broker and said in theory it looks fine. 3 weeks later they decline us after sending in lots of info. The broker didn't submit the document which shows we get am extra £45 a week and they didn't submit the info stating a lump sum had been paid off the loan. They sent it in after we were declined and Santander refuse to change their mind.

We now face doing a second application. I wish he had never got that loan but I can't physically stop people from doing what they want to do. If it comes to it the loan will have to be cleared.

Sorry it's long. The whole situation is one big mess and I'm so stressed out. We have paid for a survey and solicitors have been paid for searches so we have spent hundreds to get the ball rolling already. :(

Just to add it was declined on affordability. We were going to get a full mortgage but given the situation we are going for shared ownership and we have found a house we really want.
Thank you xx

[Deleted User]

You have a 22k deposit and a 20k loan. So effectively, a borrowed deposit. I'd be looking to get rid of the loan if the money hasn't yet been blown.

But how does he owe £23k on a £20k loan? Has he mixed up the current balance with the amount if it runs to term?

Stripeytiger2018

Thanks for the reply.

The 10% deposit is 10% of the purchase price so it's 10% of £55000

When he got the 20k loan it's showed as 26k to be repaid (with interest) he paid 3k off it so the balance is £23k.

Stripeytiger2018

Any other input really appreciated x

Thrugelmir

Suspect that you can guess most peoples opinions in such a situation. Your partner appears to value a rapidly depreciating expensive piece of metal rather more than a property to live in. One has question if he is actually bothered.

Fisa002

Reduce debt. I would either look to sell the car if you really want this house.
Making multiple applications can affect your credit score, I think you need to rethink priority. Car / house. Good luck x

Newbiejono

I dont see the problem that you got a car loan. most people. as long as you can meet affordability ?

Mermaid89

So you have a deposit of £5,500 and have an outstanding (recent) liability for over £23k? Just want to double check that!!!8217;s what you!!!8217;re saying. Lenders POV is that you will be applying to two lots of credit in a short period of time, and will also have reservations about affordability, which looks like that!!!8217;s what they!!!8217;ve confirmed. If I were you I!!!8217;d try and clear the loan and only then once its cleared would I apply again for a mortgage.

Mermaid89

Sorry I didnt put all those !!!! In my response above - I dont know why its done that

Stripeytiger2018

Thanks for the replies

I agree it was a very stupid thing to do. We have had huge arguments and I have said he's put that before the house. I even said he's put it before me because itnwas always the plan to buy a property and he's effectively sabotaged it. The mortgage broker said we met affordability and then failed to submit all documents for our income. We were declined she submitted the remaining documents and they wouldn't change their mind.

We have now agreed to put in an application with a different lender. She has assured me affordability fits, she will submit all documents and she's spoken to them and we fit their criteria. She seemed quite confident it will go through. I however do not share that confidence and have said to my partner if this gets declined its because of the loan and the loan/car will have to go so we can get a house.

He reassures me he wants to buy the house and doesn't see how it's a problem. Which is why we've had full blown arguments over it.

Mermaid89

Good luck I hope everything turns out they way you want in the end x