Why would my broker do this...

annetheman

I wondered what the possible reasons would be for a broker not to want to pursue another lender if their first choice, with a very low interest rate and good offer at AiP stage, have offered the client (me) £9,000 less? It was my first reaction to look at another lender when they came back with the offer below what I need to fulfill my offered amount.

Is it to stop me from undergoing another hard search (Experian showing "excellent" still but worried about too many searches).

Or is it commission (broker was very transparent with me about the amount they would make from the lender)?

Is it something else I haven't thought of?

I do like and trust my broker but I would like to secure the amount I have offered and don't think now's the best time for dillydallying! Help please! 

EverythingIWant

Probably knows there is little point currently? 

Thrugelmir

Was the lower amount offered due to the valuation of the property? 

dunstonh

I wondered what the possible reasons would be for a broker not to want to pursue another lender if their first choice, with a very low interest rate and good offer at AiP stage, have offered the client (me) £9,000 less?

Lending criteria?

Uses a valuer known to be more cautious on values?

Awful with admin?

Want to wait until CV-19 is over before looking at what is available?  Mortgage deals are being pulled all over the place. 

Of course, the best person to answer this is the broker.    

Is it to stop me from undergoing another hard search (Experian showing "excellent" still but worried about too many searches).

No lender takes any notice of internal scoring by credit agencies.  That is just marketing to get you to sign up to use their services.  They look at the data.   And hard searches do have an impact.

Or is it commission (broker was very transparent with me about the amount they would make from the lender)?

Mortgage commission is relatively low and does not vary significantly between lenders.

Is it something else I haven't thought of?

probably.

I do like and trust my broker but I would like to secure the amount I have offered and don't think now's the best time for dillydallying!

Is this a remortgage or a purchase?

annetheman

Thrugelmir said:

Was the lower amount offered due to the valuation of the property? 

He has only told me that they are still offering the best rate and other lenders will affect my affordability score so we should just negotiate. He is adamant they will budge *shrug* dunstonh said:

I wondered what the possible reasons would be for a broker not to want to pursue another lender if their first choice, with a very low interest rate and good offer at AiP stage, have offered the client (me) £9,000 less?

Lending criteria? Could be, tightening up the coffers?

Uses a valuer known to be more cautious on values? I have no idea

Awful with admin? How would this impact? It's Leeds Building Society if that helps?

Want to wait until CV-19 is over before looking at what is available?  Mortgage deals are being pulled all over the place. 

Yes, that's why I'm keen to get a move on with someone else!

Of course, the best person to answer this is the broker.    

He is very reassuring but not giving a lot of info to work with i.e. what did the valuation say? No answer.

Is it to stop me from undergoing another hard search (Experian showing "excellent" still but worried about too many searches).

No lender takes any notice of internal scoring by credit agencies.  That is just marketing to get you to sign up to use their services.  They look at the data.   And hard searches do have an impact.

Or is it commission (broker was very transparent with me about the amount they would make from the lender)?

Mortgage commission is relatively low and does not vary significantly between lenders.

Is it something else I haven't thought of?

probably.

I do like and trust my broker but I would like to secure the amount I have offered and don't think now's the best time for dillydallying!

Is this a remortgage or a purchase? It's a purchase, I'm a FTB should've done it years ago...

My situation:
-buying alone, £55k p/a
-property full value £355K (is this even true anymore!?)
-HTB shared ownership with 95% LTV
-Popular new build, will definitely go.
I could stay where I am and save a higher LTV but the place I love will definitely be gone. Guess it's a small price to pay at the moment, lots of people losing out a lot more now. Thanks COVID.

dunstonh

The housing market has now been put on hold unless you have exchanged already.
Valuers are now suggesting that when valuations start being made again, they will be lower than those already carried out.
Existing offer letters will be extended by 3 months.

So, you are in limbo at the moment.  i.e. don't do anything.  You have an offer on the table which may not be ideal now but could be the best you get when this is over.   There is no point applying for anything now as  buyer as it won't get processed to offer stage and you may not get the deal you think you are signing up for.

ACG

It probably wont be financially motivated. If they can get a £9k bigger mortgage then they would be getting extra commission on that £9k - albeit only about £30. 

It could be:
- Laziness.
- In the current climate they are not confident they can get it, or the fact lenders have put holds on physical valuations it will hold things up. 
- Valuation issues,
- Criteria issues. 

Guess who the best person to ask is...

annetheman

dunstonh said:

The housing market has now been put on hold unless you have exchanged already.
Valuers are now suggesting that when valuations start being made again, they will be lower than those already carried out.
Existing offer letters will be extended by 3 months.

So, you are in limbo at the moment.  i.e. don't do anything.  You have an offer on the table which may not be ideal now but could be the best you get when this is over.   There is no point applying for anything now as  buyer as it won't get processed to offer stage and you may not get the deal you think you are signing up for.

Thank you, very helpful. 

Just in your opinion, do you think that if I hold onto my offer, and it's £9,000 less, and technically no one else can really "compete" with my offer for the timebeing because the housing market has been"frozen" with my sale ongoing (offer accepted, off the market) -- this might put me in a position to ask the developers to accept £9,000 less from the asking price, especially as it is likely to go down in any case?

Bearing in mind Shared Ownership always goes fast but perhaps FTBs will find it more difficult to even get mortgages soon....

Do I have any chance at all without Leeds changing their mind about the offer (I'm not counting on this. In my heart I've lost the place already but might as well try...)

Whats_your_forte

Stab in the dark............Have you been offered incentives and who is the lender!

annetheman

Whats_your_forte said:

Stab in the dark............Have you been offered incentives and who is the lender!

I haven't been offered any incentives, but they're paying for the valuation if you'd consider than an incentive... £999 product fee and broker will make around £500 upon completion. It's Leeds Building Society I mentioned above; I had never heard of them but happy to go with whoever the professional says is best for me!

I do not doubt my broker's abilities nor his willingness to get me the best possible deals regardless of personal gain (maybe I'm naive) but I just don't know why you wouldn't try someone else... Maybe he knows something COVID-related that lenders have advised that I don't.

I have asked for more info but not relentlessly, as I don't want to bother him when he's trying his best, but I am paying for this service... I guess I'll just nobody else is interested in buying the place and they'll take £9K less.

Doubt it but there's worse happening in the world right now, so it wasn't meant to be for me.

Thrugelmir

I doubt that the property is going to sold to anyone else soon for very obvious reasons.