DIP declined by our existing lender?

sunflower92

Thrugelmir said:

Ascertaining what you can potentially borrow is where to start. 

mwarby said:

Have you spoken to your own lender, or just done an in-line application? If just an online application they might view it as you wanting to own 2 properties, a quick conversation may get you the DIP

On the phone our current lender said we cannot go through the process until our house has sold... 🤷🏻‍♀️

AdrianC

sunflower92 said:

Sorry no, we want to sell our home to move to the new property. When completing the initial DIP process online we was hoping for 90% mortgage with our 10% deposit. Thank you

It sounds like you're confusing your situation with that of an FTB.

You need to find a buyer for your place. When the entire chain is in place, and ready to exchange, then the person at the bottom of the chain puts their "deposit" equity in. That is then passed up the chain.

On completion, you put in whatever difference of equity, and your solicitor draws down however much extra mortgage borrowing.

How much is your old place selling for?
How much are you buying the new place for?
How much is your current mortgage?
Will you be putting more equity in?

sunflower92

AdrianC said:

sunflower92 said:

Sorry no, we want to sell our home to move to the new property. When completing the initial DIP process online we was hoping for 90% mortgage with our 10% deposit. Thank you

It sounds like you're confusing your situation with that of an FTB.

You need to find a buyer for your place. When the entire chain is in place, and ready to exchange, then the person at the bottom of the chain puts their "deposit" equity in. That is then passed up the chain.

On completion, you put in whatever difference of equity, and your solicitor draws down however much extra mortgage borrowing.

How much is your old place selling for?
How much are you buying the new place for?
How much is your current mortgage?
Will you be putting more equity in?

Wow I really am confusing this, 
ok so our valuation for our property is 140,000
new property is 180,000
will have approx 45,000 in equity 

foxy-stoat

Less the Estate Agent fees, 2 lots of legals and moving costs and  SDLT.

So unless you have at least £6,000 in the bank already you will have less than £45,000 in equity to use as a deposit for your next house.

Thrugelmir

sunflower92 said:

Thrugelmir said:

Ascertaining what you can potentially borrow is where to start. 

mwarby said:

Have you spoken to your own lender, or just done an in-line application? If just an online application they might view it as you wanting to own 2 properties, a quick conversation may get you the DIP

On the phone our current lender said we cannot go through the process until our house has sold... 🤷🏻‍♀️

That's correct you cannot apply for a mortgage until you actually need one. That's a different situation to a decline for a DIP. 

sunflower92

Thrugelmir said:

sunflower92 said:

Thrugelmir said:

Ascertaining what you can potentially borrow is where to start. 

mwarby said:

Have you spoken to your own lender, or just done an in-line application? If just an online application they might view it as you wanting to own 2 properties, a quick conversation may get you the DIP

On the phone our current lender said we cannot go through the process until our house has sold... 🤷🏻‍♀️

That's correct you cannot apply for a mortgage until you actually need one. That's a different situation to a decline for a DIP. 

Thank you, so if I am understanding correctly it’s a catch 22, because we have to sell our house and hope the other house is still available to then put in the offer and then we can finally go through the mortgage process? 

Thrugelmir

If you wish to ascertain how much you could potentially borrow. Try some online mortgage lenders calculators. 
You'll need to sell your existing house before vendors will even consider accepting an offer. 
Once you've sold and found a property. Then you'll need to obtain a mortgage offer. Use a broker to guide you through the maze of options. 

sunflower92

Thrugelmir said:

If you wish to ascertain how much you could potentially borrow. Try some online mortgage lenders calculators. 
You'll need to sell your existing house before vendors will even consider accepting an offer. 
Once you've sold and found a property. Then you'll need to obtain a mortgage offer. Use a broker to guide you through the maze of options. 

Thank you for your help! 

SameOldRoundabout

Were you declined for a DIP or told you couldn’t apply for a mortgage? I’m confused. If the latter you can speak to the lender again about a DIP. If the former, get a broker. Process is usually....

Get a DIP
Market your house 
Accept an offer (whether you view before that is personal choice, we did!)

Make an offer on another house 
Once accepted apply for the full mortgage, instruct solicitors and away you go! 

sunflower92

SameOldRoundabout said:

Were you declined for a DIP or told you couldn’t apply for a mortgage? I’m confused. If the latter you can speak to the lender again about a DIP. If the former, get a broker. Process is usually....

Get a DIP
Market your house 
Accept an offer (whether you view before that is personal choice, we did!)

Make an offer on another house 
Once accepted apply for the full mortgage, instruct solicitors and away you go! 

That was very helpful, thank you very much

on the phone existing lender said we could not start going through the mortgage process without our property being sold. However on the lenders website where you can apply for the DIP it was declined.

we viewed a house which we loved, wish we didn’t now as it seems this is going to be a long process! Thanks again