Mortgage declined due to unaffordability, but I can afford it, what can I do to keep my rate?

FTBLondonHelp2022

I've applied for a Natwest mortgage of £382,500.

This is 90 LTV as I have a 10% deposit of £42500 (the flat I bought costs £425,000).

I applied for a mortgage length of 30 years.

I earn 80k annually with a 10k bonus written into my contract.

I have been at my current company for 2 years and have received 2 annual bonus payments.

My first annual bonus payment was pro-rated for the 2 months I had been there and I received £1908.

My second annual bonus payment was £14,158.

Natwest have taken the average of my two bonus payments, which amounts to £8k, and are using this as reason for my unaffordability, since it's not the £10k figure I provided on my mortgage application and is not guaranteed.

I am due to speak to the underwriter tomorrow to gather more details. As I called Natwest and was given the above info by one of their customer service reps. Is there anything I can do or say or provide that will help me get this mortgage??? I'm at a loss!

If Natwest do not budge does anyone know if asking to change my mortgage length from 30 years to 35 years would work? Or asking to add more to my deposit?

I'm keen to keep my rate of 3.9% so applying for a brand new mortgage with rates of approx 6% is not what I want to do 😭

JMA74

You can play around with the calculator here: https://spa.mortgages.natwest.com/calculator/residential-affordability

This is the same calculator that the underwriter will be using. 


With a contractual annual bonus they will use the average of the last 2 payments used and use 100% of that income

With a non contractual annual bonus they will average the last 2 payments but only use 50%

The fact your bonus is guaranteed means they are already bumping it up from 50% to 100% so I would be surprised if they then used a different figure than the average.   Never know though, underwriters seem to make it up as they go along sometimes. 

FTBLondonHelp2022

JMA74 said:

You can play around with the calculator here: https://spa.mortgages.natwest.com/calculator/residential-affordability

This is the same calculator that the underwriter will be using. 


With a contractual annual bonus they will use the average of the last 2 payments used and use 100% of that income

With a non contractual annual bonus they will average the last 2 payments but only use 50%

The fact your bonus is guaranteed means they are already bumping it up from 50% to 100% so I would be surprised if they then used a different figure than the average.   Never know though, underwriters seem to make it up as they go along sometimes. 

Thank you!! 😊 I played around with the calculator and there is a shortfall of £9k once I put my bonus amounts into the discretionary bonus section. Otherwise I'm within affordability. Do you know how best to proceed so that I can try and secure my rate?

JMA74

Can you make up the difference?  If so then bring the requested loan amount down and you're sorted.

housebuyer143

FTBLondonHelp2022 said:

JMA74 said:

You can play around with the calculator here: https://spa.mortgages.natwest.com/calculator/residential-affordability

This is the same calculator that the underwriter will be using. 


With a contractual annual bonus they will use the average of the last 2 payments used and use 100% of that income

With a non contractual annual bonus they will average the last 2 payments but only use 50%

The fact your bonus is guaranteed means they are already bumping it up from 50% to 100% so I would be surprised if they then used a different figure than the average.   Never know though, underwriters seem to make it up as they go along sometimes. 

Thank you!! 😊 I played around with the calculator and there is a shortfall of £9k once I put my bonus amounts into the discretionary bonus section. Otherwise I'm within affordability. Do you know how best to proceed so that I can try and secure my rate?

There is no way to proceed apart from you making up the shortfall.. They don't lend out more than the calculator tells them they can

silvercar

Similar happened to us, over 10 years ago if that makes a difference. We banked with NatWest and had a personal banking manager. A couple of phone calls to him and it was sorted. I guess at some point a human has to look at the figures and make a decision. How you reach that person is key.