Switching mortgage product part way through application/ offer

jenand8285

Hi All,

I hope you can help. I applied for a new mortgage with NatWest for a new property purchase. The rate was 1.53 back in August at 80%LTV.

The application process has been slow and with some hiccups but the valuation was carried out yesterday and I can see on the mortgage tracker that NatWest have issues the offer today!

However, I see now they have lowered the rate to 1.41 for the same LTV. This for us would give us would be the difference between £706 pm and £664. So with the idea of potentially saving £42 a month I gave them a ring and asked if I could switch over the deal. But unfortunately they said I would have to re-apply online (I went direct, not through a broker).

Does anyone have any experience of this? It seems a little silly that I would have to submit a full brand new application. They did say the survey could be moved over, so no additional fees etc. but she couldn't be sure about the docs.


In terms of the purchase timescale, our solicitors have not received the pack from the vendors so it is still early on in the legal side of things. So I guess we do have time.

Thrugelmir

jenand8285 wrote: »

In terms of the purchase timescale, our solicitors have not received the pack from the vendors so it is still early on in the legal side of things. So I guess we do have time.

Your vendors solicitors are unlikely to have taken any action until you are in a proceedable position.

jenand8285

Thrugelmir wrote: »

Your vendors solicitors are unlikely to have taken any action until you are in a proceedable position.

At what stage would we be in a proceedable position?

Would that change if we changed the product?

csgohan4

jenand8285 wrote: »

At what stage would we be in a proceedable position?

Would that change if we changed the product?

means you have a mortgage offer, switching to another one may delay things. Would the vendor be happy with the delay? Would you risk the vendor remarketing the house?

jenand8285

csgohan4 wrote: »

means you have a mortgage offer, switching to another one may delay things. Would the vendor be happy with the delay? Would you risk the vendor remarketing the house?

Ok. But how long is it likely to delay things by? The loan amount and LTV is the same. It only took a couple of days for them to fully underwrite and mark as ‘offer subject to valuation’ once they got the docs scanned across and then a few hours to issue the offer following receipt of survey report. So I’m thinking it may not be much of a delay to switch the product... but who knows?! I wouldn’t trust NatWest to merge the application the first time.

It does seem unlikely the vendor would re-market the house over what would possibly up to one week delay. We have a compete chain now and our sale is in the very final stages of legal queries so we are in a good position.

So back to my OP, does anyone have any experience switching the product mid-application? It just seems silly to have to re-apply online only for them to merge the application.

It’s going to be a £1k saving over the 2 year fixed period, so I suppose if no one has positive experience of switching the product (and merging the application) then it could be a risk!

csgohan4

jenand8285 wrote: »

Ok. But how long is it likely to delay things by? The loan amount and LTV is the same. It only took a couple of days for them to fully underwrite and mark as ‘offer subject to valuation’ once they got the docs scanned across and then a few hours to issue the offer following receipt of survey report. So I’m thinking it may not be much of a delay to switch the product... but who knows?! I wouldn’t trust NatWest to merge the application the first time.

It does seem unlikely the vendor would re-market the house over what would possibly up to one week delay. We have a compete chain now and our sale is in the very final stages of legal queries so we are in a good position.

So back to my OP, does anyone have any experience switching the product mid-application? It just seems silly to have to re-apply online only for them to merge the application.

It’s going to be a £1k saving over the 2 year fixed period, so I suppose if no one has positive experience of switching the product (and merging the application) then it could be a risk!

What seems silly to you, is Standard operating procedure for the lender and indeed all lenders. Will likely be a new application and affordability criteria scoring as it is a new product.


But as average house buying takes 3 months, are you going to change product again during that time if rates are in your favour? This constant hard searching on your credit files does you no favours either.


When does it stop?

jenand8285

The different lending criteria makes sense! And I am glad someone confirmed that would be usual practice to submit a new application, that was after all my initial question; perhaps I wasn’t very clear in the OP.

I happened upon this rate change kind of by accident when I was looking at something else. I am not actively seeking out a lower rate!