Mortgage application before chain complete

mattg4321

I’ve recently had an offer accepted on a property, but as yet the chain is not complete. I believe the buyer on this property pulled out after about 3 weeks of waiting for the chain to complete. There is currently one property above the one I’m (hopefully) buying. 

Obviously everyone has one eye on 31st March and saving £15k stamp duty and we all know mortgages are taking much longer to approve. Affordability not a problem. I’m way under what I had AIP, but I’m SE although my partner is employed. 

Our broker is hinting we may want to apply for our mortgage straight away, but it doesn’t seem like a great idea to me without the chain being complete?

Any thoughts? Thanks. 

Suseka97

If you wait on the chain being complete before you apply, you might find that it is you that will hold up the chain.  If you look at any of the mortgage lender threads on this forum, you'll see that there's no guarantees with regards to how quickly an application to offer might be processed.  You could be one of the lucky ones and get it all sorted within a month, or like a lot of others - it could take several months.  I've been reading that applications for SE folks are the ones taking the time, just as a heads up.  Brokers do seem to be getting things through more quickly, than those of us who have gone direct - so that's a positive for you in this case.

Personally I think the previous buyer, having pulled out after only 3-weeks, was being rather impatient - we waited 5-weeks for our vendor to find their onward purchase.  Given the current situation, everything linked to buying and selling is taking much longer these days.  I also think people now need to be prepared that they might not hit that SDLT magic end date and budget accordingly (I include myself in that), unless Rishi decides to extend the DL (which is highly unlikely).

MWT

I would listen to your broker, they will have the best view of how long it is going to take to get through the approval process with your specific circumstances.

Also, just because you are way under your AIP, doesn't mean the lender will agree with the valuation your offer puts on the property

MFWannabe

mattg4321 said:

I’ve recently had an offer accepted on a property, but as yet the chain is not complete. I believe the buyer on this property pulled out after about 3 weeks of waiting for the chain to complete. There is currently one property above the one I’m (hopefully) buying. 

Obviously everyone has one eye on 31st March and saving £15k stamp duty and we all know mortgages are taking much longer to approve. Affordability not a problem. I’m way under what I had AIP, but I’m SE although my partner is employed. 

Our broker is hinting we may want to apply for our mortgage straight away, but it doesn’t seem like a great idea to me without the chain being complete?

Any thoughts? Thanks. 

I wouldn’t delay getting mortgage application in. 
It may take weeks for the chain to complete, or it might not; top of the chain may not find anything to buy and decide to go into rented / live with family to keep the chain together and make sure their house sale goes through 

K_S

mattg4321 said:

Our broker is hinting we may want to apply for our mortgage straight away, but it doesn’t seem like a great idea to me without the chain being complete?

Any thoughts? Thanks. 

@mattg4321 I can see why your broker has recommended applying for a mortgage, I'd do the same. If you've made an offer and intend to purchase this property inspite of an incomplete chain, it's reasonable to assume that you expect that the chain will complete at some point, and mortgage offers are usually valid for 6 months.

Plus ever since the covid crisis, SE criteria, packaging requirements and underwriting have changed a lot (and continue to) and apps can take significantly longer to get through so there's that as well.

mattg4321

Thanks for all the advice. It seems like a pretty unanimous decision. 

I think the risk is probably higher in waiting than in going ahead ASAP judging by what I’m reading. 

Meh123

Get your application in ASAP! I’m employed, husband is SE....we applied 17th October and are still in the queue for an underwriter to assess our application. With queues and then the likely hood of our lender asking questions (which is another 5/6 days in a queue) we’re unlikely to have an offer until mid December at the earliest. 

Thrugelmir

Your vendor will expect you to start the process as an indication of your committment to the transaction. Until you do. The concern will be that you may decide to purchase an alternative property.