Seeking advice regarding mortgage application with santander

Uz1

Hi there I have been really confused since yesterday so I had to come here and ask opinions. 

We have a mortgage application in with Santander for a second property. we are moving into the second property on a residential mortgage and our first property has a consent to let approved on it as it doesn't have enough equity to become a buy to let. we have used a mortgage broker to deal with our situation as we needed the best advice. 

The mortgage is to be a joint application, my basic salary is 38k and my wife's 16k, on top of this my payslips showed about £5500 in commission over the last 3 months. my basic salary has been 38k since before april 2020. 

After having an offer of 293k accepted for the new house, my MB said that Santander would lend us £249k meaning we needed a deposit of £44k. We started the application about 5 weeks ago, 2 weeks ago my MB came back saying that Santander is only willing to lend £230k meaning we now needed £63k deposit, a stretch but still doable as we really needed the space of a house coming from a flat so we asked the MB to carry on. Santander asked for my p60 to confirm my salary last year and we submitted my latest payslip (july) that showed £2900 commission on top of basic salary. My MB has come back to us yesterday (09/08/2021) stating Santander is only willing to lend us £214k as my salary is not 'sustainable' over a long period but in my eyes 38k basic is always going to be the same if i make £1 commission or £1000 commission. we cannot afford any more deposit than £63k and am just wondering if anybody has ever come across this before where the lender has reduced the borrowing amount twice not once? 

Can it be that santander never offered 249k in the first place, we never saw an AIP but were told that AIP suggests 249k. i understand a drop from 249k to 230k in borrowing, but i really can't get my head around the amount being lowered twice.  the MB has said that he is going to speak to the underwriter again today to reassess the situation but i do not see this amount changing at all. 

our credit scores are both above 950 and we have no problems with credit or ccj or anything that would be cause for concern

has anyone ever been through this

K_S

@uz1 I can only go off of the limited information in your post but it looks like either the broker made a mistake in assessing affordability as per Santander criteria and/or the underwriter made a subjective decision with regard to the variable components of your pay. Unfortunately, since Covid Santander has been pretty inconsistent with their underwriting vs criteria and they are unlikely to budge if they've made a decision to disregard certain income. On top of that, your background property being on a repayment mortgage is also going to play a role in dampening affordability.

There's not enough information to say if another lender would be more suitable in this scenario. Does you broker have any thoughts on whether another lender will offer the 230k+ borrowing that you need?

london21

The banks are really been extra cautious with affordability now.

Might have to use another lender.

[Deleted User]

Santander have a different way of calculating affordability than other lenders when background properties are involved.

My guess based on what has been said and my own mistakes over my career would be that the broker didnt include the correct running costs for background properties so the AIP wqs valid based on what info the system was given but the underwriter 'corrected' the figures and came up with the lower lend amount.

How it then further reduced is likely to be, as KS mentioned, a judgement call on sustainability of commission using year to date and last years figures.   I dont experience it much with Santander but perhaps the underwriter thought that with the commission fluctuating and thr background property putting pressure if it wasn't rented was too much for them to justify lending at those levels.  
Personally i have seen Santander give their underwriters more flexibility to go against their own criteria than any other lender.   Its a nuisance not knowing if a case is going to go through even if it meets all the criteria and numbers so I've stopped using them for anything remotely non vanilla