Santander Mortgage Prisoner Application & Previous Bankruptcy - Is My Mortgage Adviser Mistaken?

nickologjam

I've approached a mortgage adviser regarding a remortgage from my existing lender (Landmark) as I should be eligible for help as a mortgage prisoner. I was declared Bankrupt Aug 2015 and discharged a year later.
Adviser has been pretty gung-ho in my opinion and put an application straight in to Santander before Christmas. I raised my concerns immediately as my understanding is that they don't accept ex-bankrupts regardless of circumstance and I don't want a failed application to hurt my credit history which I've worked hard to improve over the last few years. 
Any thoughts on whether mortgage prisoner help from Santander applies the same lending criteria regarding bankruptcies and also if they are likely to get to the point of conducting a search before they kick this out? Thanks.

Cscott139

I have just lifted this from the Santander website and it does say they can consider light adverse outside of policy although I wouldn't have thought this would fall into that category. Your broker should have called Santander before submission.

Types of cases can we consider

• Failed standard like-for-like remortgage affordability assessment/loan to income policy
• Failed standard LTV policy
• Light adverse credit performance outside of existing policy

ACG

Has he run your case past Santander? That is the big question, if he has spoken to them and they have said it fits then it looks promising. If he hasnt, then I would agree, it is a little gung-ho.

Going off Nicks post, I am not sure I would 4.5 year discharged bankruptcy as minor (I also would not class it as major but it is in that grey area for me). 

K_S

@nickologjam Santander has a criteria of a blanket no to anyone who has been bankrupt in the past. 

Afaik, the mortgage prisoner reforms amount to a modified affordability assessment, lenders can still have other criteria.

Having said that, I haven't done any mortgage prisoner apps. As you've used a broker, you'd assume that they checked with Santander before putting in the application.

nickologjam

There were no pre-checks done. I've asked outright was it a pre-application or full? He confirmed it was a full application and we should just wait and see.

I'm really not sure whether to request that this application be withdrawn just to safeguard my credit file?

K_S

@nickologjam I'm reluctant to second guess your broker as he has all the information and we only have the limited information in your posts, but given their published criteria re bankruptcy, I can't think of any good reason why he wouldn't check with Santander prior to applying.

With regard to your credit file, if the application has been made around Christmas, the hard footprint would already have been registered on your credit report so (as far as I can tell) there's nothing to be gained by withdrawing it now.

nickologjam

Thanks @K_S This is pretty much what I wanted to know. If the damage is done then so be it. 
I'll have to see how it plays out. Hopefully the Santander process picks up the obvious issues early on. 
I know we can't second guess the broker but I find it unlikely that he has the inside track over and above the published policies of Santander.

nickologjam

So I've finally heard back from the Broker and unsurprisingly Santander have knocked this application back as I don't meet the standard lending policy.
Interestingly they also refused it on affordability as the broker had supplied income details which I understood weren't required for the modified affordability test.
The only saving grace is they have only registered a soft search against my record.
.........back to the drawing board it is then!!

MovingForwards

You've had two brokers comment in your thread, it may be worth approaching one of them if you have lost faith in your current broker. 

Many of us have used the brokers who comment on these boards, as it's easier to get a feel for them by reading through their previous posts.

ACG

I dont understand some brokers. They would rather spend half an hour keying on a DIP and then seeing where it goes when they could make a 5-10 minute phone call and save time keying it on and waiting days for it to be underwritten.

Just commenting on @MovingForwards comment this is not really a case for me I am afraid. I would want you to pass affordability. I would not place a case where affordability does not stack up... I am not sure how my insurance would be affected down the line. The adverse can potentially be overcome at normal rates though. If affordability does stack up (ie it was only failing with santander) then there may be lenders who will accept you without going down the mortgage prisoner route. 

nickologjam

Thanks for the comments.
I think my best bet will be to look again after August. I will be 6 years post bankruptcy then.
I mistakenly thought that Mortgage Prisoner Help may have been a quick fix for affordability checks (that was the professional advice given) but I now see that we may be best adding my Wife's income and look to re-mortgage conventionally in joint names. We should be OK on affordability that way.
We are both self employed and another set of accounts under our belt showing rising income in April should also help.