Mortgage Application Rejected

fatboydaz

Hi everyone,

Our mortgage application was rejected, even though we were initially given a mortgage in principle. The broker we used is unsure why this happened.

Should we wait to find out why the application was refused before approaching another bank? The response we received simply said, "application unsuccessful."

Our broker advised us to approach another bank, but we’re worried that they might reject us for the same reason, which could affect us in the long term.

Any advice on what we should do next?

Thanks!

Mark_d

The main difference between an agreement in principle and formal mortgage offer is the credit check.  I suggest you look at your credit reports from the main credit reference agencies.  It's not impossible that you have a CCJ but aren't aware of it.

housebuyer143

Have you recently checked all your credit files to make sure that's not the issue?

fatboydaz

My credit score is perfect my wife has a CCJ from a parking ticket, which we paid off a long time ago and the bank was made aware of that. 

Phoenix72

Ignore that make believe credit score. How old is the CCJ?

Mark_d

fatboydaz said:

My credit score is perfect my wife has a CCJ from a parking ticket, which we paid off a long time ago and the bank was made aware of that. 

In that case perhaps the CCJ isn't the issue.  Does you address history match with the electoral role information on your credit report?  Have you got a good track record of having a stable income?  When you did the agreement in principle, did you both disclose all borrowing - loans, credit cards etc ?

born_again

fatboydaz said:

My credit score is perfect my wife has a CCJ from a parking ticket, which we paid off a long time ago and the bank was made aware of that. 

They look at credit history. Any missed payments?

fatboydaz

Hi,

We have been living with family since 2022, no loans, no missed payments. I called another company mortgage company who specialise in this and they said they are very confident looking at all our documents they could get us a mortgage but it will be from a lender that charges a slightly higher amount. They feel it’s the CCJ and they charge a fee of £1699 if the mortgage is granted. 

My worry is it’s not the CCJ and it’s something else. The reason being is after we gave them proof the CCJ was satisfied the broker came back to me with this email  

Apologies, there is another requirement - they want to see your last 2 years SA302's and corresponding Tax Year Overviews.

My work history was self employed till Nov 2023
Then Full Time Permanent since 2023 and still at the same company.

The same bank in March of this year gave us a new mortgage deal as we switched from Nationwide to TSB for our BTL, they asked about our CCJ we provided the same proof and then they granted us the mortgage. But for the residential mortgage they wanted CCJ information then a week later wanted SA302’d and Tax Overviews.  

SDLT_Geek

fatboydaz said:

Hi,

We have been living with family since 2022, no loans, no missed payments. I called another company mortgage company who specialise in this and they said they are very confident looking at all our documents they could get us a mortgage but it will be from a lender that charges a slightly higher amount. They feel it’s the CCJ and they charge a fee of £1699 if the mortgage is granted. 

My worry is it’s not the CCJ and it’s something else. The reason being is after we gave them proof the CCJ was satisfied the broker came back to me with this email  

Apologies, there is another requirement - they want to see your last 2 years SA302's and corresponding Tax Year Overviews.

My work history was self employed till Nov 2023
Then Full Time Permanent since 2023 and still at the same company.

The same bank in March of this year gave us a new mortgage deal as we switched from Nationwide to TSB for our BTL, they asked about our CCJ we provided the same proof and then they granted us the mortgage. But for the residential mortgage they wanted CCJ information then a week later wanted SA302’d and Tax Overviews.  

Off topic, sorry, but you still own a house or flat which you rent out? (You mention a buy to let.)  Also that you have been living with family since 2022. 

Have you looked into whether extra stamp duty is due?  If buying in England, it could be an extra 3% stamp duty land tax (SDLT).

fatboydaz

 SDLT_Geek said:

fatboydaz said:

Hi,

We have been living with family since 2022, no loans, no missed payments. I called another company mortgage company who specialise in this and they said they are very confident looking at all our documents they could get us a mortgage but it will be from a lender that charges a slightly higher amount. They feel it’s the CCJ and they charge a fee of £1699 if the mortgage is granted. 

My worry is it’s not the CCJ and it’s something else. The reason being is after we gave them proof the CCJ was satisfied the broker came back to me with this email  

Apologies, there is another requirement - they want to see your last 2 years SA302's and corresponding Tax Year Overviews.

My work history was self employed till Nov 2023
Then Full Time Permanent since 2023 and still at the same company.

The same bank in March of this year gave us a new mortgage deal as we switched from Nationwide to TSB for our BTL, they asked about our CCJ we provided the same proof and then they granted us the mortgage. But for the residential mortgage they wanted CCJ information then a week later wanted SA302’d and Tax Overviews.  

Off topic, sorry, but you still own a house or flat which you rent out? (You mention a buy to let.)  Also that you have been living with family since 2022. 

Have you looked into whether extra stamp duty is due?  If buying in England, it could be an extra 3% stamp duty land tax (SDLT).

Yes, so we changed our old residential into a BTL, moved in with family and then a tenant has been living in that property since March 2022. 

We moved in with family so we could save and build up the additional Stamp Duty (£13,500) for a £325k house. We also have the 15% deposit (£48,750k) for the new house. 

I would personally love to keep that £14,700 and the deposit and just rent a property but my wife won’t entertain that idea. Rents are always on the rise and the lack of security is a huge factor for her.  

Bigphil1474

Could it be your income if you have only been employed for 7 months, and were previously self employed?