Mortgage offer of 180k slashed to 98k!

amnblog

Will you still make affordability for the equity loan with an extra £450 pm going out? Has the Broker checked?

Agreeing to several hundred pounds on new car finance during a mortgage application is a regular problem and never fails to amaze me. Our record was a client who signed up for £650 pm on a Range Rover and didn't think to tell us.

Pablosammy

£450 of £4k take home is quite a big chunk! Over 10% of your total income, and a much higher percentage than that of your actual disposable funds after living costs are accounted for. I can only presume with those payments that you've added a rather substantial amount to your long term debt total, and being an expensive car, it will probably cost a lot to run?

Anyway, enough judging about the car. The long and the short of it is your circumstances changed significantly when you signed a car finance agreement costing you well over £5k cash a year, and the mortgage affordability calculations will have to take that into account. Given that you (by your own admission) don't have excellent credit, it will have been a big red flag to the mortgage lender.

Have you actually taken delivery of the car, or can you back out?

gemmylouise

4K take home is our bare minimum without overtime or bonuses. I appreciate £450 a month might sound a lot on a car but we don't smoke or drink or pay gym memberships so it's our treat to buy a nice car. We don't want to send the car back!

Thanks for your replies it is all sorted out now.

kingstreet

The OP appears to be sorted, fortunately.

For future readers of this thread, I've never once in 34 years ever asked about net income, disposable income or anything similar.

Lenders deal only in gross annual incomes and how they are made up (basic, overtime etc) and your gross monthly commitments, such as car finance, loans, childcare, maintenance payments etc.

Anyone tempted to apply for credit during the process, take the hint - "no new credit between mortgage application and completion."

Thrugelmir

gemmylouise wrote: »

so it's our treat to buy a nice car.

The danger with treats is that the novelty soon wears off. Breaking the habit is the challenging part. Lenders full well know this, as there's statistical evidence to support.

amnblog

kingstreet wrote: »

- "no new credit between mortgage application and completion."

Should read

no new credit between mortgage application and completion

getmore4less

gemmylouise wrote: »

4K take home is our bare minimum without overtime or bonuses. I appreciate £450 a month might sound a lot on a car but we don't smoke or drink or pay gym memberships so it's our treat to buy a nice car. We don't want to send the car back!

Thanks for your replies it is all sorted out now.

You choose your priorities.

You preferred a nice car over a nicer house.
(now or later as the money is gone)

Now work out the true cost of the car by adding the increased interest you are paying on the house.

silvercar

getmore4less wrote: »

You choose your priorities.

You preferred a nice car over a nicer house.
(now or later as the money is gone)

Now work out the true cost of the car by adding the increased interest you are paying on the house.

The point is OP could have had the nice car and the lower interest rate if they had waited a couple of months for the car.

AstroTurtle

gemmylouise wrote: »

4K take home is our bare minimum without overtime or bonuses. I appreciate £450 a month might sound a lot on a car but we don't smoke or drink or pay gym memberships so it's our treat to buy a nice car. We don't want to send the car back!

Thanks for your replies it is all sorted out now.

However a mortgage lender is looking at worst case scenarios. If one of you loses your job and your paying £450 and maybe 500pm for a mortgage that's 50% of total income on 2 debts alone.


Mortgage lenders stress test mortgage applications for the event of a job loss/death etc.




Taking out a £450PM car finance mid mortgage application is just a silly move to make. Especially when you have bad credit.

csgohan4

expensive lesson here, OP is going to have to save up, while the house prices continue to increase potentially, unless you go lower your budget,

You can always get a new car/ old car, but the house you want and can obtain only comes round only so often