HSBC Decision in Principal

monneyspinner

here goes!

I find my new build dream house in the catchment area for a school which will help to support my childs additional needs.

I contact my existing lender HSBC, run through income and outgoings and get the decision in principal with the mortgage amount I need. I then go ahead, reserve my dream property and pay a further deposit. All good.

Within 3 months I recontact HSBC to renew the decision in principal, yes we're still good to go, property won't at this stage be ready for entry for 6 months. I wait 2 months (incase the entry date from the builder changes as they told me application offer is only valid for 6 months) accept a written offer on my existing home (outwith catchment area) and have a mortgage adviser call me today to go ahead with the application.

Before it moves anywhere (no credit check completed) suddenly they have an issue, which then becomes my issue (nothing has changed my end, I've not missed any payments, in fact I've paid off HP agreement early!) now they've dropped my decision in principal by £28k!!! and me and my child are facing losing our dream home and our existing home

Formal complaint has gone in after I've taken reflection time to word correctly. They've been my main bank for over 20 years and that has been a massive slap to the face, the worlds local bank is making me homeless!

I have 14.5 weeks to get a mortgage in place and I'm stressed to the max!

why has there been such a turnaround in regards to the decision in principal?

any help/suggestions welcome

scottishblondie

There is no point in loyalty to your "main" bank, see an independent mortgage broker ASAP to get a mortgage arranged.

We got a DIP from HSBC last year, at the time they were our existing mortgage provider and we wanted to port our product. I gave all the information requested and was given a DIP for a good £75k more than we required. We put in an offer which was accepted, and so went ahead with a formal application with HSBC. This is where it all fell apart. Suddenly they slashed the amount they were offering us to 50% of what we required on the basis of exactly the same information I'd given them the previous week. We were heartbroken and angry, but I quickly realised there was no point in either.

I contacted a broker our solicitor recommended and within 2 days we had an offer from the Halifax for the full amount we required. A formal complaint isn't going to get you anywhere, so though it may be hard to set aside the emotion try your best and push on with getting a mortgage from another provider.

bengalknights

As above go to a broker and they will get you a offer based on your details.

Exodi

I'd take a step back, and leave your emotions at the door.

Firstly, I'd contact a broker who will be able to save time from applying to places you won't get a suitable mortgage from.

Secondly, my main bank (Lloyds), were offering me 3.2% fixed for 5 years - Nationwide were offering me 1.99% fixed for the same deal. This is a saving of £150 a month! There's no loyalty in mortgages!

Thirdly, I wouldn't waste your time with a complaint - if they're not willing to lend you money, sending them a "TO WHOM IT MAY CONCERN" won't make them suddenly willing.

14.5 weeks is a long time, I'd give London & Country a call (assuming you don't have difficult circumstances), MSE endorses them, I used them and had no problems, and they don't charge a fee!

Thrugelmir

monneyspinner wrote: »

now they've dropped my decision in principal by £28k!!!

DIP is not a mortgage offer. In no way is it binding on the lender. As is purely an estimate. Lenders can and do change their internal lending criteria at any time. With Brexit approaching there may well be a tightening with certain products.

You should have applied for a mortgage earlier. Renewing the DIP had no value.

monneyspinner

Thanks all! I’ve went with local broker and have mortgage offer all
In space of 12 hours which is a massive relief!

Goes to show decision in principal is waste of time. Least there was no credit check left on my file from application

I couldn’t have applied earlier as the offer only was only valid for 6 months post application and I had to reserve end of October with completion June this year