Santander Mortgage Application

blaise802001

Currently halfway through a mortgage application and hit a bit of what my broker calls a stumbling block. 

My partner and I are buying a house for £210k. I have £86k equity in my house but we were looking to borrow £135 and put down £75k deposit. 

I am porting £114k so we’re looking to lend and additional £21k on a new product over 20 years. 

We have joint credit card debt of circa £10k. I earn £47k salaried. Partner is self employed and only drew a wage over last 2 years of £10k

I have 2 x loan payments that are deducted from net salary. One for £291 ending this month and one for £225 ending in October. 

Broker has just confirmed that because I have £516 a month deducted from pay that they won’t let us the additional £21k. We are nowhere near the max affordability on the AIP we had. Broker is asking Santander if they will consider removing the £291 from affordability as it is paid off this month. I’ve also asked them if they could extend the term, but wondering why they haven’t offered this. 

Broker has run us and AIP with Natwest in the meantime. 

Has anyone else ever had this where Santander just say no and don’t try to match you to affordability? I’m baffled 

Hoenir

You apply. They make a decision. Santander aren't there to offer any other services. 

A_Random_Man

First of all I'm sorry your mortgage hasn't been agreed hopefully I can clear up why or how the mortgage hasn't proceeded. So affordability at Santander is different to other banks and building societies, what happens is that the deductions on your payslip reduce the total net income you can use for affordability, when Santander do their budget planner they put your income in and then there's a section for deductions such as pension, student loan etc, there's also other boxes for pre-tax deductions and post tax deductions, the underwriter has entered the deductions on there and what has likely happened is that the net the calculator can use is lower than the net you receive monthly & also lower than what the broker declared which has in this case resulted in the extra borrowing being unaffordable in some cases it may result in a maximum loan.

What could have also happened is that the broker could have put the deductions are pre-tax when they're post tax, a pre-tax deduction will reduce the net income less than a post tax deduction will. The first thing I'd get the broker to do is ring in and check the affordability is correct, underwriters can and have made errors if the result is right, you'll either have to include extra income if there is any, pay off some of your debt (no guarantees) or proceed without the extra borrowing if the underwriter is happy to do so

In terms of the mortgage term it has to be close to affect the budget planner, if the affordability is close it will automatically show a alternative term in your case it might not be close enough to make the case affordable 

blaise802001

A_Random_Man said:

First of all I'm sorry your mortgage hasn't been agreed hopefully I can clear up why or how the mortgage hasn't proceeded. So affordability at Santander is different to other banks and building societies, what happens is that the deductions on your payslip reduce the total net income you can use for affordability, when Santander do their budget planner they put your income in and then there's a section for deductions such as pension, student loan etc, there's also other boxes for pre-tax deductions and post tax deductions, the underwriter has entered the deductions on there and what has likely happened is that the net the calculator can use is lower than the net you receive monthly & also lower than what the broker declared which has in this case resulted in the extra borrowing being unaffordable in some cases it may result in a maximum loan.

What could have also happened is that the broker could have put the deductions are pre-tax when they're post tax, a pre-tax deduction will reduce the net income less than a post tax deduction will. The first thing I'd get the broker to do is ring in and check the affordability is correct, underwriters can and have made errors if the result is right, you'll either have to include extra income if there is any, pay off some of your debt (no guarantees) or proceed without the extra borrowing if the underwriter is happy to do so

In terms of the mortgage term it has to be close to affect the budget planner, if the affordability is close it will automatically show a alternative term in your case it might not be close enough to make the case affordable 

thank you. That makes sense. I’ve had a pay rise so my broker has gone back to them. If not we are going to put in the extra 10k from our savings. Thank you for the reply. 

Aria1986

A heads up dont rely on an AIP meaning you’ll absolutely get a mortgage…more and more people are having to go back to the drawing board when their application is denied. Your broker will know best it may just take a little longer than anticipated.

blaise802001

Aria1986 said:

A heads up dont rely on an AIP meaning you’ll absolutely get a mortgage…more and more people are having to go back to the drawing board when their application is denied. Your broker will know best it may just take a little longer than anticipated.

Thanks for the reply. My mortgage broker actually got us an an AIP for 400k with no change to any of the information we gave her 🙄 far from the 135k we asked for,  all sorted now though thankfully 😅