Help Needed: Mortgage Refusal Due to Possible Financial Oversight

ACG

Hoenir said:

fatboydaz said:

Hoenir said:

fatboydaz said:

Currently, we are living with our three children at my brother's home while our house is rented out. The prospect of renting a home ourselves is not appealing.

From the lenders perspective. What was the plan back in 2022? Was there a reason not to remain in your own property. When is the BTL mortgage product due for renewal? Is there a hefty increase in interest rates on the cards. Which will impact profitability. 

The mortgage for the BTL is £740 and the Rent is now £1300. 

Do you have a fixed term mortgage product for the BTL?  

Why is this important? 
It does not matter if it is on a variable rate at 9%, if it is self funding and affordability is ok, which it appears to be, its clearly not the problem. 

You would also expect a lender to be far less secretive about this being the reason for a decline. 

Hoenir

ACG said:

Hoenir said:

fatboydaz said:

Hoenir said:

fatboydaz said:

Currently, we are living with our three children at my brother's home while our house is rented out. The prospect of renting a home ourselves is not appealing.

From the lenders perspective. What was the plan back in 2022? Was there a reason not to remain in your own property. When is the BTL mortgage product due for renewal? Is there a hefty increase in interest rates on the cards. Which will impact profitability. 

The mortgage for the BTL is £740 and the Rent is now £1300. 

Do you have a fixed term mortgage product for the BTL?  

Why is this important? 
It does not matter if it is on a variable rate at 9%, if it is self funding and affordability is ok, which it appears to be, its clearly not the problem. 

You would also expect a lender to be far less secretive about this being the reason for a decline. 

As you know yourself. It's the full picture that's required. Self funding is fine as long as there's no rental void. At 9% the rental would operating at a loss on the mortgage interest alone. With no account of other costs. 

MWT

Hoenir said:

ACG said:

Hoenir said:

fatboydaz said:

Hoenir said:

fatboydaz said:

Currently, we are living with our three children at my brother's home while our house is rented out. The prospect of renting a home ourselves is not appealing.

From the lenders perspective. What was the plan back in 2022? Was there a reason not to remain in your own property. When is the BTL mortgage product due for renewal? Is there a hefty increase in interest rates on the cards. Which will impact profitability. 

The mortgage for the BTL is £740 and the Rent is now £1300. 

Do you have a fixed term mortgage product for the BTL?  

Why is this important? 
It does not matter if it is on a variable rate at 9%, if it is self funding and affordability is ok, which it appears to be, its clearly not the problem. 

You would also expect a lender to be far less secretive about this being the reason for a decline. 

As you know yourself. It's the full picture that's required. Self funding is fine as long as there's no rental void. At 9% the rental would operating at a loss on the mortgage interest alone. With no account of other costs. 

Those sort of problems would also be clear to the broker, I'm not sure we need to look much beyond the failure to declare the income and the potential for this to have resulted in a flag, so checking for that, as is being done, feels like the right move.

fatboydaz

I spoke to a few financial advisors today who specialise in this, they said even if you rectify any mistakes on the National Hunter Database the chances of you getting mortgage remains the same. They hardly ever remove the mark on your name so your best option is to rent for 6 years and accept the fact that you have accidentally what they believe deliberately tried something illegal. My only other option is to go to a private lender who charges 8% interest only but that's just insane.

I honestly feel like I have let my entire family down and we are just in limbo now.  

MWT

You have done a subject access request I assume?

https://nhunter.co.uk/subject-access-request/

fatboydaz

MWT said:

You have done a subject access request I assume?

https://nhunter.co.uk/subject-access-request/

I have yes but that will take 2-3 weeks the estate agent is calling asking what is going on with the mortgage as he wants to put the house back on sale. If he hears I am waiting for that do you think he will back out of the sale

The first bank that declined the mortgage was TSB so do you think it's worth approaching them before the hunter report arrives? 

MWT

fatboydaz said:

MWT said:

You have done a subject access request I assume?

https://nhunter.co.uk/subject-access-request/

I have yes but that will take 2-3 weeks the estate agent is calling asking what is going on with the mortgage as he wants to put the house back on sale. If he hears I am waiting for that do you think he will back out of the sale

I suspect anything short of a well advanced mortgage application is going to have the same result, but I wouldn't suggest telling them specifically about National Hunter.

If your broker couldn't get more details out of TSB then I doubt that just asking them will get any more details.

Personally if I was in your shoes I'd be inclined to try reapplying to TSB after you've got the tax record corrected and have your broker specifically mention that the tax issue was discovered and fixed...

It would be good to hear ACG's perspective as a broker as well.

fatboydaz

Update on this is we received an email from Cifas that said. 

As of the above date, there is no Cifas data on our systems registered in your name and date of birth at the address(es) you supplied

So now still waiting on the National Hunter Report. 

ACG

Every seller is different. But what you tend to find is if you hide away from the agents trying to drag things out, that will only go on for so long. They know if you are not calling back there is a problem. 

Telling them that there is a problem and that you are resolving it will have one of 2 outcomes, they give you some time to sort it or they get a bit worried and put it back on the market. Hiding from them is only going to have one outcome, they put it back on the market and potentially blacklist you from future viewings. 

I have just checked with a couple of lenders (little building societies) out of curiosity more than anything and they have basically said they could "potentially consider it". Its far from a guarantee as I have had lenders say they can consider it and then decline. But its also not 8% if it is accepted. 

fatboydaz

If my wife and I have made a joint application for a mortgage and the underwriter has denied it, will both our names be flagged on the National Hunter register? My wife has been working in a school for the past 10 years, so I'm confident there are no issues with her name. We are considering having her purchase the property with my brother or sister and leaving my name off the application.

What I am worried about is if it is flagged again, will it then affect my sibling for future applications? Any advice or insights would be appreciated.