Declined by nationwide?

firsttimebuyer95 · 30 January at 3:08PM

My partner and I have used a mortgage broker to apply for a mortgage, we had a decision in principle given to us by nationwide which covered the value of the property. We are first time buyers and have made an offer of 343,500 on a house with a 95% LTV ratio which means we are giving a £17,175 deposit. Our Experian credit score is over 1000 and we make £84,808 annually between us, we have some credit card usage which is around £5000 between us but no cars on finance or anything else on finance or credit. I have a £900 overdraft which I dip into sometimes. We were told by two mortgage brokers that we would have no trouble at all getting a mortgage for that amount as we have good wages and good credit scores, never missed any payments or anything. Our mortgage broker applied for the mortgage amount of £326,325 through nationwide as we had our decision in principle for a higher amount than that and we passed the application stage. The application went in on Tuesday and today we have been told that it has been declined by nationwide and our broker responded to them saying “I have just received the below decline and struggling to make sense of it. They passed DIP and full app. Have strong income and a small amount of unsecured debt.” He has now suggested applying again with NatWest as we will be unlikely to be declined again but now I am concerned we will not get our mortgage. My broker said that it may be due to the high LTV rate but this was fine when decision in principle and application was made to nationwide, it’s really disheartening. Are we unlikely to be approved for our mortgage with our new NatWest application? My broker said that we may have just had a very strict underwriter but still could not really give us much info as at to why as he said we have good, secure jobs with good wages and no dependants, Has anyone else experienced this? I am feeling really disheartened.

Isthisforreal99 · 30 January at 3:18PM

First of all, ignore your 'credit score' from Experian, nobody else sees it.

Have you went through each of your credit files with a fine tooth come, no hidden defaults, on electoral roll etc.

This may sound a bit blunt but on your combined income a £17k deposit is pretty low and also using your overdraft when you have a very low level of debt. Where does your money go that you need to use an overdraft and only have £17k depositand have £5k on a credit card.

Did it get to the stage of sending back statements? Maybe your spending concerned them.

vacheron · 30 January at 7:43PM

https://forums.moneysavingexpert.com/discussion/comment/81862107#Comment_81862107

Sorry to also be blunt, but this was the first thing that jumped out to me too:

An £85K combined income with no car loans and a minimal deposit, yet still needing to dip into an overdraft would make me more than a bit concerned about lending someone a further £325,000.

Just as one possible example: What happens when you eventually need purchase or replace your car(s) but now have an additional £1,700-£2,000 mortage to pay every month for the next 25 years?

ACG · 30 January at 8:00PM

When you say you have £5,000 on credit cards, what are the limits?

Nationwide are really hard on people who have been using a lot of their available credit. In essence, they would rather you have £10k limit using £5k than having £6k available and using £5k - same amount of credit, but the usage as a percentage is a lot higher.

If you have gone over 90% of your available credit in the last 3 (or maybe 6) months, then that will probably be the reason.

Natwest will be a lot more relaxed on this front. Assuming that is the issue.