Mortgage broker - ask me anything

K_S

James-may said:

K_S said:

James-may said:

K_S said:

@rennes99 I don't know about how it shows on reports but I can say with certainty that a NatWest AIP would not be issued without a soft-footprint or hard-footprint credit check.

While I don't doubt you know what you are talking about, as you work in this field.
I had an aip from NatWest, once I had an offer accepted I applied properly and was instantly declined, I later that day spoke to someone who resubmitted the application and again was declined, they said they didn't have a specific answer as to why other than the checks for aip were different to the pre checks for mortgage proper.
However looking back at all my credit checks.
No soft it hard checks were done for my aip, but 2 appear for both times I was declined on the same day.
Seems NatWest aren't doing a soft check to give aip, at least nothing appears on my credit report.

@james-may You might well be right about your case and I don't know anything about it. But as you would expect, I do NatWest apps for clients every week (they're very competitive at the moment) and I can assure you that they do do credit-checks (soft-footprint at DIP and hard-footprint at FMA) and specifically mention that prior to clicking the 'Submit' button on the broker portal for both the DIP and the FMA. There is no way for a high-street lender to run a 'credit-score' without that. It could be that footprints did not show in the cases you've mentioned due to a technical error or something I guess.

Perhaps it is a technical issue, only 2 searches from NatWest on all 3 report companies I use and both searches were on the same day from when I put the pre application through proper, and both were soft searches.
With Santander they did one soft fir aip, and what looks like a hard search when applying proper, at least that's what my reports say.
As you said it might have been a glitch that the search didn't appear, or could have been a glitch that the system didn't do a search on aip.
Guess I'll never know.

@james-may Finally found it! I was most likely incorrect. It came back to me later and I've been meaning to correct the record but didn't find the time to dig out the post.

Many years ago during training I remember one of the selling-points we were coached on was that NatWest direct DIPs sometimes don't do a credit-check (of any kind) and so it's less reliable than a broker one and to use that in our conversations with potential clients. At that time this used to be mentioned in the small print on the DIP letter/certificate.

In that case sometimes a positive DIP can be followed by an instant decline at Full Application when a credit-check is actually done. Which I'm assuming is what happened with youself. I'm actually quite surprised to see that they might still be issuing this kind of pointless DIP so many years later. Thanks for pointing this out and apologies for giving you incorrect/incomplete information.

george4064

My partner & I are looking to move home, which would involve porting an existing mortgage and taking out additional borrowing.

Our current mortgage is for £173k with NatWest (via a broker), we are looking to carry over our £247k equity and borrow a further £230k to buy a house for £650k.

We want to look into an interest only mortgage for the £230k part, however it seems we fall just short of the joint base salary requirement of £100k by £4K.

Our annual bonuses easily take us over the £100k figure, combined with our decent 38% equity and given that only £230k out of total £400k mortgage will be interest only. What chances do you think we have if our broker asks NatWest to consider us for an interest only mortgage?

I work in finance and can put together a detailed plan as to how we would invest the money and hence have a credible strategy in place to meet the capital repayment at maturity.

K_S

@george4064

- If the bonus has a track record, you can add 50% of the 2 year average, they will use that towards the £100k requirement. Hopefully that gets you where you need to be.

- "can put together a detailed plan as to how we would invest the money" I don't expect that to meet NatWest's requirements for an acceptable repayment strategy. There are many different repayment vehicles that they will consider, probably best discussed with your broker.

JohnFTB

I'm looking to sell my house and use the money for a deposit, plus the house i'm buying I will be inheriting part of, can I use the inheritance as a deposit? Sounds quite messy to have the deposit coming from two housing transactions. Is there particular mortgage firms who specialise in this? 

K_S

JohnFTB said:

I'm looking to sell my house and use the money for a deposit, plus the house i'm buying I will be inheriting part of, can I use the inheritance as a deposit? Sounds quite messy to have the deposit coming from two housing transactions. Is there particular mortgage firms who specialise in this? 

@johnftb Not exactly sure what you mean by using your inherited part-share as a deposit. But if you mean that someone (usually a sibling) is buying you out of the inherited house, yes you can use the cash proceeds from that as a deposit.

Skeptical_John

I've done a couple of AIP through the online process but I'm hoping to borrow a bit more than they are suggesting. Is it worth phoning the banks/ building societies to try and increase it or is that likely to be the max they would lend me?

K_S

Skeptical_John said:

I've done a couple of AIP through the online process but I'm hoping to borrow a bit more than they are suggesting. Is it worth phoning the banks/ building societies to try and increase it or is that likely to be the max they would lend me?

@skeptical_John Some lender AIPs will give a yes/no for whatever you ask for and other will give you a max borrowing figure.

If you have input the numbers+data correctly in the AIPand it has given you a max-borrowing figure, calling up the lender is unlikely to make a difference to that.

ElmTree0512

Hi @K_S, this is a great thread!
Me and my partner are in a bit of a predicament so any advice would be helpful.

We rent but our landlords have told us they are looking to sell next year (they are good friends). Knowing how much we love the house, they have offered us first refusal. The house hasn’t been valued recently but going by local prices/online estimates from agents, we think it’s likely between £210-£230k.
We are now saving a deposit. We both recently opened LISAs (my partner in March and me in April and have around £1k (my partner hasn’t saved what he normally would because of the reasons below...)

Upon getting our credit files from CheckMyFile, we discovered some small defaults on my partner’s file from 1-2 years ago that he didn’t know about. He has immediately settled these (hence not having as much to save).
One that is outstanding is from his old bank - he closed his account a couple of years ago after having money stolen but they are saying he had bills go out during the switch which put him in an overdraft. He has a meeting with his new bank this week so they can see if they were at fault for this (he was never told anything about it). The amount is around £4.5k.

On top of this, we’ve also discovered he’s had some high interest loan accounts logged to his credit file which are not his (some recorded as being paid via debt management schemes). We have reported them to Action Fraud and they are being investigated by the lenders at the moment. We really want them gone asap as they obviously paint a very bleak picture that isn’t factually correct.
My credit file is clean, no missed payments or defaults but I do have approx £8k CC debt which I always pay over minimum payment and on time (0% interest).

My partner earns £35500 and I just over £30000 (hopeful of an increase soon). We have around £1400 disposable income at the moment. No dependents and both 31. We have spoken already to a whole market broker who has said she will help us but we’re yet to do a DIP given what’s going on. She has mentioned 95% mortgages to us but also an option whereby our landlord ‘gifts’ us some deposit by selling slightly under market value (I may have worded this poorly!)

The broker has been highly recommended to us from people we know and the fee is reasonable/only on completion.

I’m interested to know your view as a comparison. Do you think we should do DIP anyway or is it pointless at the moment? Once the errors are removed, can you see us having problems? We feel very worried. 

K_S

@ElmTree0512 If I'm not wrong, your partner has on his credit report -

- multiple satisfied defaults registered 1-2 years ago

- one unsatisfied default of 4.5k

- multiple payday loan accounts (isn't clear how old this is)

- a DMP in his name being paid

I don't see how a joint app would pass a 95% DIP tbh at this point in time. And if you are only looking to buy next year, there's nothing to be gained by doing one now.

Imho, you are likely to be best off focusing your efforts on getting any errors in the credit file corrected and then reassassing your options once the credit file is as clean as it's going to be.

Having said all that, as you have spoken to a broker and they know the whole scenario, they are best placed to give you tailored advice. Good luck!

ElmTree0512

K_S said:

@ElmTree0512 If I'm not wrong, your partner has on his credit report -

- multiple satisfied defaults registered 1-2 years ago - 3, all small. Two telecomms accounts he thought had been cancelled and one final CC bill he’d missed. All settled.

- one unsatisfied default of 4.5k - he will learn more about this one this week, at the moment the bank isn’t sure if it is at fault (they have told him if they are then he is not to worry about it). If for some reason it is down to him to pay he will, but then it’ll slow down any saving on his part and we worry it will cause problems if not settled by the time we want to apply. 

- multiple payday loan accounts (isn't clear how old this is) - they all seem to be 3+ years old and each have defaults/arrangements to pay in place or have been sold to DCAs. We discovered one is being paid 18p a month! Really bizarre and have scared us as they are not my partners

- a DMP in his name being paid - only one account is being registered as ‘DM’ and is one we don’t recognise. He’s certainly never entered into any kind of formal DMP  

@K_S. I’ve popped a few additional comments above to help clarify. We thought as much too, we didn’t want to start doing things when the situation isn’t accurate for fear of just being disappointed so appreciate your view. We are concentrating all efforts on clearing the errors and saving as much as possible. It scares us and feels like quite a hard slog but all we can do is keep fighting!