Collapsed chain but can't port mortgage

nicthemighty

Hi, vendor has pulled house from market after their onward purchase collapsed. We had already received a mortgage offer at 90% LTV from HSBC

The offer terms say "If, during this period, you make a change to your application which does not affect the interest rate(s) offered here, we'll issue you with a new offer although the period for which it'll be valid will not be any longer." - our understanding is that while we are asking to borrow more, we're still in the 90% LTV bracket and so it shouldn't change the interest rate?

We found a new property that was 8k more than original purchase, and broker applied to HSBC to move the offer. However, HSBC have said that they won't allow that change because 90% LTV are no longer available. He's trying to see if he can negotiate the offer to be ported if we pay the shortfall on the new property - but I'm worried that he won't be able to and as such we'll have to collapse the chain as we won't have the deposit for 85% LTV.

Is this something we have grounds to complain over? The offer terms are really quite wooly - in that they don't explicitly state what "changes" affect the interest rate.

AdrianC

You're changing the property, you need a different offer - the old one applied to THAT property, because the lender need to be certain it's adequate security.

They no longer offer 90%, so they aren't offering you 90%.

nicthemighty

AdrianC said:

You're changing the property, you need a different offer - the old one applied to THAT property, because the lender need to be certain it's adequate security.

They no longer offer 90%, so they aren't offering you 90%.

Thanks - I was hoping that as they were willing to lend the money in July that they'd still honour it now (other than the need for new valuation). But I guess from a business perspective it makes sense that they'd prefer to spend the valuation effort on a new < 85% customer as lower risk.

Thrugelmir

Both the the lending and property markets have moved on since July for very obvious reasons. Lenders will be constantly revising their products as events unfold.  

nicthemighty

Thrugelmir said:

Both the the lending and property markets have moved on since July for very obvious reasons. Lenders will be constantly revising their products as events unfold.  

I naively assumed that as the offer would be honoured if we were with the original property, moving it to a new property would at worst just be a new valuation.

Crashy_Time

nicthemighty said:

Thrugelmir said:

Both the the lending and property markets have moved on since July for very obvious reasons. Lenders will be constantly revising their products as events unfold.  

I naively assumed that as the offer would be honoured if we were with the original property, moving it to a new property would at worst just be a new valuation.

It is the outlook for the economy and your finances that the banks are looking at, not the actual property, but the next valuation will probably be lower so you are not really losing out?

nicthemighty

Crashy_Time said:

nicthemighty said:

Thrugelmir said:

Both the the lending and property markets have moved on since July for very obvious reasons. Lenders will be constantly revising their products as events unfold.  

I naively assumed that as the offer would be honoured if we were with the original property, moving it to a new property would at worst just be a new valuation.

It is the outlook for the economy and your finances that the banks are looking at, not the actual property, but the next valuation will probably be lower so you are not really losing out?

But we have lost out as we can't continue with our purchase...

steampowered

Could you get a mortgage with another lender?

You would be out of pocket for things like survey fees even if staying with HSBC.

nicthemighty

steampowered said:

Could you get a mortgage with another lender?

You would be out of pocket for things like survey fees even if staying with HSBC.

Unfortunately 90% LTV needed as we'd been making a step up into a larger family home and we're not FTB.

nicthemighty

Our broker in the end managed to speak to their intermediatery manager who got us the same mortgage terms, we just had to pay the difference.

london21

nicthemighty said:

Our broker in the end managed to speak to their intermediatery manager who got us the same mortgage terms, we just had to pay the difference.

That's great managed to work out in the end. Helps having a good broker.