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First time buyer - Help!

Hi, 

I've been scrolling this forum for a few weeks reading stories of people getting rejected to a mortgage so thought I would just ask based on our own personal circumstances. 

We have reserved a new build and put down a £99 non-refundable deposit down on it, so I'm not too fussed if we lose that. House is due to be ready end of May/beg of June 

We have spoken to the mortgage advisor who the builder has recommended and they were happy with our circumstances, however a previous MA we spoke to a few weeks ago told us to hold off for a few months to be in the best situation we can. So current situation is - 

House price - £260k
Deposit - 10%  £8k from a family gift, £5k from the builder as an incentive , £13k of our own savings (which is in a LISA so this includes the 25% bonus) 

Financial situation 
-I'm on £24k and fiance is on £33k 
-Currently renting but moving back home to save up as much as money as possible (we are hoping to pay back £4k of the gift as soon as we get the keys) I have a strong credit score and only debt is £5k left on my car finance and £60 on my credit card (credit limit between both credit cards is £3,700)
-Fiance on the other had has a poor credit score due to 2x defaults both satisfied and for about £200 each (one was six years ago today so this has now dropped off, next one is six years ago next month so this drops off then) 
- Fiance has £3.2k on his credit card with a £3.6k limit (this was previously maxed out last month and he has paid some off and this is planned to be payed off before mortgage starts) also has a loan which is £400 a month but the last payment is due in March so this won't be taken into account for the mortgage affordability, no other debts as he has a company car
- Fiance also has gambling on his statements from jan and December (about £100 a month) Feb is clean. Never gone into an overdraft with this, but this is multiple smaller transactions (£30, then £30, then £30) which I know looks bad. 
- Our latest 3 months bank statements show us living payday to payday as just before Christmas we also went on holiday and had to dip into our savings due to unexpected PCR tests on top of holiday spends, no excuse we should have planned wisely but this has been out first year renting and this has been our year learning about money and we have learnt out lesson that we need a larger buffer in our savings. I have put about £200 away in savings this months (and £300 went on my credit card as I used that for Christmas) but £99 was used for the reservation fee. Living at home we will be saving about 2k a month between us but some will be used to pay off the credit card.

Mortgage situation 
- Got a DIP from Barclays through our broker, provisional accept subject to underwriter approval (R017 if anyone knows what that means) and they ran a hard credit check on my fiance but not me, I'm assuming this is as his credit rating flagged as low 
- Waiting on application being submitted, brokers have been really slow with us and had poor communication since we put the reservation fee down which is worrying me as how much time have they spent assessing if this is the right mortgage for us and how likely we are to be accepted?

One last thing
Bloor are keen for the contracts to be exchanged in 28 days so are pressuring us to instruct the solicitors who want £250 initial payment, but I do not want to pay that until we have the mortgage offer (I also don't have that money until we get paid next week). Are we in our rights to say we are not doing this until we have received a formal mortgage offer as I don't want to risk losing a total of £349 including the reservation fee? We were keen to get the mortgage application submitted ASAP its the brokers who have been really slow in coming back to us and letting us know what other documents/ information they need, we've always got anything they asked for over in a few hours and then we have to call them to chase and check its okay and ask when they can put our application in. keep being told 'its with the case handler who will submit it' - really wish I didnt use them now but all their reviews were great and they won't be charging us as we were introduced through bloor!

For anyone that took the time to fully read this - thank you! :) 

Comments

  • You need to instruct a solicitor as soon as you know who you are going with for your mortgage as no seller is going to sit around and wait weeks for your mortgage while the solicitors do nothing. These things can take place simultaneously and is they want you to exchange in 28 days, they need to. I think the concern is you cant pay for the solicitor until next week... that is going to look bad to a lender if you end of month monies are that low you don't have £250 spare.

    if you are unhappy with the broker, then go with another as you need to be sure they are going to do a good job. The brokers the new build developers tried to get my sister to go with were terrible. 

    I dont think the 6yr old defaults will cause much issue tbh. I would be inclined to get a 2nd opinion before applying with that broker and see if you are happier with another broker. 

    BTW - do not mention to the lender you are paying back this gift - its not a gift if you are planning to or are required to do this.
  • Hi, thank you! Completely agree not having £250 spare is embarrassing, next month we will be fine it’s just due to the credit card payment (which I’ve learnt not reply on for Christmas!) so we’ll have over £1k in savings next week and this will just keep building 

    We could just about stretch to the £250 but this would wipe us out completely and like I said, until a mortgage is guaranteed I’m not comfortable losing that money 

    Deffo won’t be telling them we want to pay the gift back! There’s no pressure to pay this back as it is a gift, it’s just something I would want to do. 
  • You need to instruct a solicitor as soon as you know who you are going with for your mortgage as no seller is going to sit around and wait weeks for your mortgage while the solicitors do nothing. These things can take place simultaneously and is they want you to exchange in 28 days, they need to. I think the concern is you cant pay for the solicitor until next week... that is going to look bad to a lender if you end of month monies are that low you don't have £250 spare.

    if you are unhappy with the broker, then go with another as you need to be sure they are going to do a good job. The brokers the new build developers tried to get my sister to go with were terrible. 

    I dont think the 6yr old defaults will cause much issue tbh. I would be inclined to get a 2nd opinion before applying with that broker and see if you are happier with another broker. 

    BTW - do not mention to the lender you are paying back this gift - its not a gift if you are planning to or are required to do this.
    Hi, thank you! Completely agree not having £250 spare is embarrassing, next month we will be fine it’s just due to the credit card payment (which I’ve learnt not reply on for Christmas!) so we’ll have over £1k in savings next week and this will just keep building 

    We could just about stretch to the £250 but this would wipe us out completely and like I said, until a mortgage is guaranteed I’m not comfortable losing that money 

    Deffo won’t be telling them we want to pay the gift back! There’s no pressure to pay this back as it is a gift, it’s just something I would want to do. 
  • ACG
    ACG Posts: 24,643 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    I wont lie, I stopped reading about half way.

    But from what I can gather no defaults but a single late payment (albeit quite recent) and a bit of debt by the time you apply. 
    Should be fine. 

    Hopefully the broker only gets paid if you get accepted, if that is the case I would not worry too much and trust the broker. 
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • ACG said:
    I wont lie, I stopped reading about half way.

    But from what I can gather no defaults but a single late payment (albeit quite recent) and a bit of debt by the time you apply. 
    Should be fine. 

    Hopefully the broker only gets paid if you get accepted, if that is the case I would not worry too much and trust the broker. 
    Haha I appreciate even reading half way through!! I’m a massive worrier as I’m sure you can tell so thank you :)
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