Nationwide product switch pre/post offer

middleagedriver

Hi, we just applied for a mortgage with Nationwide yesterday. I asked the advisor if another product became available at a cheaper rate before we exchange/complete on a property would we be able to switch to it. They were very much yes with several caveats, i.e. it might need to go through underwriter again, our current offer would be cancelled.

Has anyone done this before? Any problems?

If our circumstances haven’t changed I can’t see it being an issue. Obviously timing would need to be right, I wouldn’t switch near to exchange/completion.

ACG

I do not think I have done it with nationwide, I have done it with other lenders. 
I did have a problem once where it failed the credit check, but I spoke to my account manager and we got it sorted. More often than not there is not a problem. 

The potential problem you have in the current climate though is that although the rate payable may come down, the SVR rate may have increased and that can affect the affordability checks. Also with the cost of living, if the lender reviews their ONS figures that may also affect affordability. Although I think ONS figures typically only get updated around April/May time.

Also as house prices begin to drop, you could find lenders tighten up credit scoring and so what you passed last month, you may not pass next month. 

In essence, the broker is doing the right thing by covering their back. You can potentially apply to go on to the cheaper product but it may not be a given that it will be agreed. If/when rates come down, speak to your broker and get advice from them at the time.

kingstreet

The existing offer has to be cancelled for a new offer to be issued. That's standard.

It's possible the case might need re-underwriting if the lender has made criteria/affordability changes in the period between offer and amendment. One one of my cases, I would check criteria again and re-work affordability to ensure no 'shooting oneself in the foot' scenario.

middleagedriver

I'm currently well under affordability. They could lend us £400k yesterday with 80% LTV I'm lending £220k. So there would have to be some serious change to their affordability calculations. Will speak to them if/when the rate comes down.