Mortgage refused due to fixed term contract

charlotteh96

Hi,

I am seeking some advice please regarding porting of our old mortgage deal to a new, more expensive property.

We sold in September and had originally planned to do a non-simultaneous port of our mortage with Nationwide, meaning we could hopefully recoup our ERCs and continue our old rate on the new property, although we would need to borrow about £100,000 more. 

Unfortunately our job positions have recently changed as we have moved to a new area. I am the main earner, on £60,000, and my partner is a teacher and is on around £34,000. The problem we are having is that he has gone from supply teaching (which he was doing for around 1 year so they would have accepted that) onto a fixed term maternity cover position ending in September 2025. This means that he hasn't been employed for 12 months at the time of application, nor does he have 24 months remaining on his contract, as per Nationwide's criteria. We realise this is our mistake but are wondering if there is anything we can do. 

We have looked at borrowing on just my income alone but unfortunately I'm around £7000pa short of being able to do that with the 4.49x salary multiples I'm advised that Nationwide use.
Our broker is appealing the decision but I don't have a lot of hope. 

Is there anything else we could do? Or do we just need to accept the loss of our old deal & ERCs and move on to applying with a new lender? I had looked at increasing my hours to try and increase my overall income but I worry this would become unsustainable and it may not even make a difference to their decision. It is frustrating because teaching is such a stable career (there is a real shortage of science teacher and they are paying retention bonuses just to keep them in the profession) and our old deal would be due to finish before his contract is up anyway, but I suppose the lenders hold all the power.

I hope this doesn't come across as entitled, we hoped but never expected that we definitely would be able to port the mortgage, it's just a shame that we'll be throwing a lot of money down the drain. (We weren't able to stay in the old house for the entire duration of the deal as we needed to move about 2 hours away for our jobs - we were renting and paying bills on two properties so it was better just to sell up and hope we could port the deal at a later date). 

If anyone has any experience of successful appeals or any words of support that would be greatly appreciated.

Thank you  

Hoenir

Renegotiate the price on the new property?  On a general note. Lending criteria once set is rigid. Has to be a cut-off point. Lenders don't advance money on the basis of what if, but the factual details at the point of application. 

charlotteh96

Hoenir said:

Renegotiate the price on the new property?  On a general note. Lending criteria once set is rigid. Has to be a cut-off point. Lenders don't advance money on the basis of what if, but the factual details at the point of application. 

Sadly we’d need to drop it by about 30k which will never happen. 

I appreciate this - but just to clarify, do you mean if we were to reapply if I had increased my hours and overall salary, it would still be a no? Or do you just mean that
appeals are unlikely to be successful without any changes to our situation? Thanks. 

housebuyer143

Lending criteria is rigid like the other poster said. Your broker might have success because she's a teacher (which is very much stable work, everyone is short of teachers) and she can show she has been in the same type of employment for some time, so see what they come back with. Unfortunately if they don't agree but then there's nothing you can do to overturn this. 

charlotteh96

Will this mean we now need to declare that we have been rejected when applying for credit/loans? This makes me so sad because I’ve never missed a credit card payment, I’ve done everything I can since being a teenager/young adult to make sure my credit report is squeaky clean so it’s really crap to have it tarnished over a technicality. 

housebuyer143

charlotteh96 said:

Will this mean we now need to declare that we have been rejected when applying for credit/loans? This makes me so sad because I’ve never missed a credit card payment, I’ve done everything I can since being a teenager/young adult to make sure my credit report is squeaky clean so it’s really crap to have it tarnished over a technicality. 

No, I wouldn't say so. You haven't been successful because you don't meet the criteria, nothing to do with your credit worthiness.

Hoenir

charlotteh96 said:

Will this mean we now need to declare that we have been rejected when applying for credit/loans? This makes me so sad because I’ve never missed a credit card payment, I’ve done everything I can since being a teenager/young adult to make sure my credit report is squeaky clean so it’s really crap to have it tarnished over a technicality. 

Your credit report is unblemished. Your application potentially hasn't met this lender's set criteria fo the amount you are applying to borrow. . 

Your broker should have been aware of the lenders criteria. Which is a clearly defined policy not a technicality.