Nationwide's impossible lending criteria

koaladiggerz

Morning all,

My partner and I are stuck between a rock and a hard place and would really appreciate guidance on where to go from here....we are in the process of purchasing a new build commercial to residential flat conversion that is 1 storey. Standard construction, nothing out of the ordinary and at least 23 other plots have been sold and inhabited by this development.

09/04 - mortgage application in with Nationwide
13/04 - valuation in person by Countrywide
19/04 - valuer asks for list of additional assurances
24/04 - affordability check

To cut a long story short, we have met all but 1 of these additional assurances by providing warranties, structural engineer letters, architect drawings and letters etc basically going above and beyond what we should have to as buyers so we've been told. The outstanding one is that the lifespan of the building is in excess of 60 years...except no strucutral engineer or surveyor can do this as 1) there is no such calculation and 2) their professional indemnity insurance would not cover them to make such a certification. We told Nationwide this who pass it onto the valuer for them to not acknowledge that they are asking for an impossibility and don't tell us what we can offer instead. They just maintain the lending criteria are not met so the report is unchanged. We have been in person, on the phone, i've raised complaints but i'm getting nowhere. We are locked in at April's rates which given the base rate increase of 1.25% since then...we struggle to see the incentive for Nationwide to process this offer. 

We are astonished how this can happen; how can Nationwide's lending criteria be something impossible to provide and why isn't the valuer questioning them? Even if they didn't know which is dubious, why is it on us to provide it and when we send them an official letter from the structural engineer saying it's impossible do they not then amend said criteria.

Anyway as you can probably tell I'm certainly at my wits end! Any suggestions on what to do? Thanks in advance

nicmyles

I'm sorry about this, but I think you may find it easiest to try a different lender if you have genuinely exhausted all avenues. Once you get into "computer says no" it can be really hard to get back out.

I was in a position where there had been a retention on the mortgage because the original surveyor had identified "penetrating rising damp" around a window. It was a 2nd floor window so "rising damp" was clearly a typo, although there was damp as a result of the window being old. Bought the flat making up the difference, replaced the window, Halifax refused to accept any and all documentation associated with it because they demanded a "rising damp guarantee", which does not exist. Window installer wrote "there is no and will be no rising damp because it is a 2nd floor flat" on headed paper, but that was unacceptable.

I had to remortgage with a different lender in the end, because they wouldn't allow me to go on a new fix unless the matter was resolved, and it could not be resolved.

K_S

koaladiggerz said:

Morning all,

My partner and I are stuck between a rock and a hard place and would really appreciate guidance on where to go from here....we are in the process of purchasing a new build commercial to residential flat conversion that is 1 storey. Standard construction, nothing out of the ordinary and at least 23 other plots have been sold and inhabited by this development.

09/04 - mortgage application in with Nationwide
13/04 - valuation in person by Countrywide
19/04 - valuer asks for list of additional assurances
24/04 - affordability check

To cut a long story short, we have met all but 1 of these additional assurances by providing warranties, structural engineer letters, architect drawings and letters etc basically going above and beyond what we should have to as buyers so we've been told. The outstanding one is that the lifespan of the building is in excess of 60 years...except no strucutral engineer or surveyor can do this as 1) there is no such calculation and 2) their professional indemnity insurance would not cover them to make such a certification. We told Nationwide this who pass it onto the valuer for them to not acknowledge that they are asking for an impossibility and don't tell us what we can offer instead. They just maintain the lending criteria are not met so the report is unchanged. We have been in person, on the phone, i've raised complaints but i'm getting nowhere. We are locked in at April's rates which given the base rate increase of 1.25% since then...we struggle to see the incentive for Nationwide to process this offer. 

We are astonished how this can happen; how can Nationwide's lending criteria be something impossible to provide and why isn't the valuer questioning them? Even if they didn't know which is dubious, why is it on us to provide it and when we send them an official letter from the structural engineer saying it's impossible do they not then amend said criteria.

Anyway as you can probably tell I'm certainly at my wits end! Any suggestions on what to do? Thanks in advance

@koaladiggerz Sorry to hear about the trouble you've had. If you've gone direct, and have raised a formal complaint, I guess that's as much as you can do.

If you are using a broker, they may be able to try to progress this their way as well.

With valuations (especially for first occupants of a flat conversion), these kind of issues can be tricky to resolve as the lender will fall back on the valuer's opinion.

In hindsight, what you should have done at the first indication of a valuation issue back in April, is research and put in an app with another lender as backup. At least that's what I suggest for my clients that encounter similar valuation-related issues and still want to proceed.

If you still want to buy this flat, while the Nationwide process goes on, it may be advisable to ask your broker if they can find a suitable lender. If you don't have a broker, then take all the information you have re the property and speak to a broker.

Good luck!

koaladiggerz

@nicmyles thanks for your reply, it isn't right that they can ask for things that aren't real! It's so disheartening, it seemed like one more document and this would be resolved and here we are in mid-August! It will now cost us £12.5K more over the 5 years fix on today's rate and climbing, all because Nationwide couldn't get their act together. I'm hoping in the long run it's a cheap mistake to make, we will never wait this long on a lender again

nicmyles

koaladiggerz said:

@nicmyles thanks for your reply, it isn't right that they can ask for things that aren't real! It's so disheartening, it seemed like one more document and this would be resolved and here we are in mid-August! It will now cost us £12.5K more over the 5 years fix on today's rate and climbing, all because Nationwide couldn't get their act together. I'm hoping in the long run it's a cheap mistake to make, we will never wait this long on a lender again

Hope you sort it. As another poster has said above, you can apply elsewhere while still trying to resolve this.

I came to peace with the frustration of it in the end by thinking of it this way: it is their money and if they don't want to lend it to you (however mad their reasoning), they don't have to, however Kafkaesque and pointless the whole thing is!

koaladiggerz

@K_S thank you, I am using a broker and he says he has escalated it his end as well but I am wondering why he didn't do what you suggested. Perhaps after the 8 week mark he should have advised another application as a backup when it was clearly going pear-shaped and it wouldn't be quite so costly to us now. It seems we are just rather unlucky with this combination of factors but i'll look into submitting to another lender today

simon_or

OP, not all brokers are made the same. The large volume broker employee types don't care if your application drags on or not, it doesn't make a huge amount of difference to their income whether you complete or not, whether you're happy or not and whether you recommend them or not.

A good experienced independent self-employed broker otoh will think outside the box as they rely on word of mouth to grow their business. And there's no basic salary to fall back on.

Don't waste any more time waiting for Nationwide, get an application in before rates rise further.

luis1988

koaladiggerz said:

Morning all,

My partner and I are stuck between a rock and a hard place and would really appreciate guidance on where to go from here....we are in the process of purchasing a new build commercial to residential flat conversion that is 1 storey. Standard construction, nothing out of the ordinary and at least 23 other plots have been sold and inhabited by this development.

09/04 - mortgage application in with Nationwide
13/04 - valuation in person by Countrywide
19/04 - valuer asks for list of additional assurances
24/04 - affordability check

To cut a long story short, we have met all but 1 of these additional assurances by providing warranties, structural engineer letters, architect drawings and letters etc basically going above and beyond what we should have to as buyers so we've been told. The outstanding one is that the lifespan of the building is in excess of 60 years...except no strucutral engineer or surveyor can do this as 1) there is no such calculation and 2) their professional indemnity insurance would not cover them to make such a certification. We told Nationwide this who pass it onto the valuer for them to not acknowledge that they are asking for an impossibility and don't tell us what we can offer instead. They just maintain the lending criteria are not met so the report is unchanged. We have been in person, on the phone, i've raised complaints but i'm getting nowhere. We are locked in at April's rates which given the base rate increase of 1.25% since then...we struggle to see the incentive for Nationwide to process this offer. 

We are astonished how this can happen; how can Nationwide's lending criteria be something impossible to provide and why isn't the valuer questioning them? Even if they didn't know which is dubious, why is it on us to provide it and when we send them an official letter from the structural engineer saying it's impossible do they not then amend said criteria.

Anyway as you can probably tell I'm certainly at my wits end! Any suggestions on what to do? Thanks in advance

Hello, I hope you don't mind me reaching out for a bit of help...

We are in the process of applying with Nationwide on a one-off new build with a small local housebuilder that is on an existing street between other properties.

It comes with a PCC and covers up to £2.5m indemnity insurance.
However, it states this runs out a few weeks after the build is due to be completed and was wondering if this is the same as your 60 year clause? It doesn't mention anything about the lifespan of the building but literally states the following:

"We, the Insurance Brokers, hereby certify that the above named insured is currently insured for the period ending 12th October 2022."

Can you shed any light at all? Thanks in advance!