Santander left us in bad way!

Snay87

Me and my husband are FTM buying a new build. We had a mortgage at the beginning of the year with Santander where the mortgage was only valid until April 7th (I needed it until the end of April). Santander said this was fine as the mortgage expired on 30th June anyway and to call closer to the time of the build wasn’t ready by 7th April. We then went on to exchange contracts and pay the builders the deposit. Then coronavirus happened and construction work had to legally stop! I called Santander in March and explained because of Covid we’d be delayed now and they were totally fine about it and said we’ll just change the date to June 30th (again this was the original expiration date). I asked if they could extend it further as government guidance was for lender to extend offers by 3 months they said to call back again closest to the time and it would be no problem to extend. Our builders started work last month but because of social distancing the work has been slower but we are definitely completing by the end of this month (July). Towards the end of June I asked my financial advisor to contact Santander to extend the mortgage as because of Covid we weren’t hitting June 30th. Santander have now turned around and said their policy has changed and they are now offering 4.45x people’s salary not the original 5x we were originally offered and cannot give us the money they first promised as we’ve gone past June 30th and it’s classed as an expired product. 

Surely they can’t do this!!??? Our builders had to stop work because of Covid it’s through no fault of anyone that we haven’t been able to move in on time! And they didn’t actually ever offer me an extension to my mortgage. We’re supposed to complete in 17 days and I just can’t believe they’ve left their customers in such an awful position whilst in this global pandemic. 

Can someone let me know if they’re actually allowed to do this!? 

Thrugelmir

Yes they can. Your offer is time limited. Extension is at the discretion of the lender. 

Did your solicitor put a long stop into the contract prior to exchange? 

The full impact of Covid is yet to be felt. Lenders will have become extremely cautious. Hence the reigning back in risk. 

Snay87

Thrugelmir said:

Yes they can. Your offer is time limited. Extension is at the discretion of the lender. 

Did your solicitor put a long stop into the contract prior to exchange? 

The full impact of Covid is yet to be felt. Lenders will have become extremely cautious. Hence the reigning back in risk. 

Even though they knew we had already exchanged and paid a deposit based on that mortgage offer and they told me they’d happily extend my offer if Covid impacted the build completion date? 

csgohan4

Snay87 said:

Thrugelmir said:

Yes they can. Your offer is time limited. Extension is at the discretion of the lender. 

Did your solicitor put a long stop into the contract prior to exchange? 

The full impact of Covid is yet to be felt. Lenders will have become extremely cautious. Hence the reigning back in risk. 

Even though they knew we had already exchanged and paid a deposit based on that mortgage offer and they told me they’d happily extend my offer if Covid impacted the build completion date? 

Who is they?, a lower level call handler? Unless you have it in writing, it won't stand. 

I'm afraid the current crisis has impacted everyone else in terms of mortgages, withdrawal or products, refusal of extension of offers, as they were done before the crisis. 

Lenders are now more risk averse and acting accordingly and sustainably. You exchanging and paying a deposit is of no concern to the lender, you didn't exchange with the lender did you for example?

LouLou589

Snay87 said:

Me and my husband are FTM buying a new build. We had a mortgage at the beginning of the year with Santander where the mortgage was only valid until April 7th (I needed it until the end of April). Santander said this was fine as the mortgage expired on 30th June anyway and to call closer to the time of the build wasn’t ready by 7th April. We then went on to exchange contracts and pay the builders the deposit. Then coronavirus happened and construction work had to legally stop! I called Santander in March and explained because of Covid we’d be delayed now and they were totally fine about it and said we’ll just change the date to June 30th (again this was the original expiration date). I asked if they could extend it further as government guidance was for lender to extend offers by 3 months they said to call back again closest to the time and it would be no problem to extend. Our builders started work last month but because of social distancing the work has been slower but we are definitely completing by the end of this month (July). Towards the end of June I asked my financial advisor to contact Santander to extend the mortgage as because of Covid we weren’t hitting June 30th. Santander have now turned around and said their policy has changed and they are now offering 4.45x people’s salary not the original 5x we were originally offered and cannot give us the money they first promised as we’ve gone past June 30th and it’s classed as an expired product. 

Surely they can’t do this!!??? Our builders had to stop work because of Covid it’s through no fault of anyone that we haven’t been able to move in on time! And they didn’t actually ever offer me an extension to my mortgage. We’re supposed to complete in 17 days and I just can’t believe they’ve left their customers in such an awful position whilst in this global pandemic. 

Can someone let me know if they’re actually allowed to do this!? 

Hi - what was the original expiry date on your mortgage offer paperwork? You mention the 7th April; and then that it expired at the end of June? What date was on the paperwork?  We currently have an offer with Santander that we received back in early Feb - this has an expiry date of 31st July. COVID and other complications has meant that we are unlikely to exchange or complete by that date. I looked at Santanders extension policy and they are offering automatic 2 month extensions pre-exchange, and 3 months for anyone that has exchanged (google Santanders mortgage extension offer and it should come up - I couldn't post a link in this post). 

I would guess that the original offer had an April expiry date, and when you made that first call to discuss extensions they gave you the 2 months from that date taking you up until the end of June. Perhaps the call handeller wasn't very clear on that point however their website is clear that there are no further extensions beyond that; and that anything else is classed as a new application. 

I'm no expert in what happens next with regard to your commitment to purchase the house as your have exchanged;  or how you would get any deposit back (hopefully your solicitor is able to advise on that). But I'm surprised your Solicitor exchanged contracts without having confirmation of the mortgage offer expiry date though or checking completion dates fell within the offer period. 

If the date on your original mortgage offer is 30th June you should be able to get an extension provided there has been no changes to your income (not furloughed etc...) 

Whatever happens next make sure you get all confirmations in writing moving forward. It sounds like there have been a lot of different dates and information given to you verbally which sadly won't stand up without any written confirmation. 

[Deleted User]

Exchanges happen all the time with expiring mortgage offers. Had a new build that took 2 years and 3 different mortgage lenders before we completed.   It's the risk you take buying a new build unfortunately.

Santanders policy is clear, 1 extension only.   Apply again or look for a new lenders.  

Given the current state of mortgages, I'd recommend using a broker