FTB Mortgage with Nationwide - Bank Statement

synavm

Hi all, my first thread on here. Far from a financial expert so appreciate you guidance.

My wife and I are in the process of purchasing our first home, following a purchase that fell through last year due to the chain collapsing. This time around, we’ve opted to take advantage of the HTB equity loan scheme and combine it with a gifted deposit from my father - in effect a deferred inheritance from my late Mother which has come through the sale of Dad’s property.

The property with chosen is £370,000. We’re using £78,250 from Dad’s gift and using the maximum £74,000 HTB equity loan, which gives us a final LTV of around 59%. Straight forward, right?

Well, following an approved decision in principle from Nationwide, our mortgage application is with the underwriters, valuation is going through on Monday. The other day our lender phoned up to ask for my bank statement - and here’s where I get concerned. I’m quite far into my overdraft (around £3,500) and don’t clear it month by month with my salary. My outgoings have previously been quite high with lots of credit agreements that are reaching the end of their term this year. This, combined with welcoming a new born in June has led to an expensive month and a bank statement that doesn’t put me in the best light!

My credit rating is very good, both myself and my partner haven’t as much as a late payment to our name over the past six years. Our combined income is around £50,000 and all our our committed outgoings (Credit Card £2,700/£75 per month, Car Loan £2,500 balance/£108 per month) and my overdraft are going to be cleared upon completion using some of the remaining funds from our inheritance/gift. This will leave us significantly better off month by month - even taking into account things like home and life insurance, increase in council tax.

I’m really, really anxious about this, so would be good to hear of other people’s experiences!

sal_III

Did you state all of your debt - overdrafts, CC, car loans etc. when you applied for DIP? If so, you have nothing to worry about, if not, you are likely right to worry about.

The question here is why on earth don't you use the inheritance to clear your current debt which is less than £10k and then apply for mortgage? It's not like you won't have plenty left for a deposit

synavm

Yep, it was all stated.

RE why I can!!!8217;t pay off the debts now, I!!!8217;m waiting on Dad to complete on his sale, so the debts will likely be paid off around the time we exchange assuming everything is okay.

synavm

So, as feared, we've been refused based on our Overdraft usage. We're now stuck between two lenders- We have an AIP in place with Halifax, Santander are better for affordability and their products are better.

My question is what are Santander underwriters like? Are we likely to end up with the same fate as Nationwide. I've read there fairly picky.

jennhg88

I'd suggest using a broker instead of jumping about between lenders, another refusal will not look good.

synavm

Cheers, I've contacted L&C

Edit- Great start from L&C, they've misadvised me/lied to me about Halifax's lending criteria with regards to New Build warranties.

sparkey1

When you save they rejected you on your overdraft usage, did they actually say that or have you assumed?

Might be worth checking Santanders lending criteria before you go any futher with them. It can be found at:

https://www.santanderforintermediaries.co.uk/products-and-criteria/mortgage-lending-criteria/

synavm

They told me the underwriters took issue with the overdraft and as my three bank statements showed me in overdraft, they weren’t happy to proceed, however, once Dad completes and everything is paid off, they will reconsider with three clear bank statements. That’s not really any good for me with this purchase.

L&C are recommending NatWest (but would mean putting in a higher deposit meaning nothing left over on completion once deposit is paid and CC, Overdraft, Car paid). It’s a really privileged position but I had hoped to save a little bit. That said it’s really not the end of the world, we’ll have a lot more disposable income when we move.

Realistically it’s looking like NatWest or Halifax. I’ve heard Santander are quite strict with overdraft usage and could be risky for someone like me to choose them. Not sure if any of the resident brokers can confirm or deny this in their experience...

synavm

Going to try and appeal the decline. My other half has some savings which we can use to clear one of the overdrafts or part of the CC or Car loan. We wouldn't be able to clear the whole lot until Dad completes, but thought it might be worth a try following some helpful advice.

Do any of the resident brokers on here think this is worth a try? Any experience of appealing an underwriters decision at Nationwide? What are my chances?

Sib2018

We are currently with Natwest for current mortgage. 5 years ago they wanted the 10 percent deposit but required wife's step dad as guranter. I made mistake and paid same credit card twice instead of the other. Hence they would not let me on the mortgage application at the time.
Wife looking to lend 168k the rest will be made up of the deposit 20 percent, basically transferring the equity on our current home.

synavm

Apologies for the bump.

Resident brokers and general experts - what sort of chances do I have with Natwest of getting this through? As was the case with Nationwide, Natwest too have asked for my bank statements. My online broker is insistent that it'll be fine, but my research suggests it's not that clear cut. My alternative would be Halifax who when I've dealt with in the past and have not asked for a statement - it went through to offer that time but the chain ended up falling through.