Can Lender withdraw deal after I've signed application form?

LCK73

Has anyone any experience in this area?

Basically, I've been pre-approved over the phone for a mortgage with the Co-op. I've now completed my application form and sent it back to them for the deal I was approved for. I've heard nothing since (2 weeks) other than me calling them to check they had received my application form, which they had.
I notice that they have now changed the deal they are advertising on their website and for the same deal one now has to stump up a 25% deposit as opposed to the 10% deposit I signed up for. I'm wondering if the Co-op can actually now withdraw from our deal and ask me to stump up 25% to get the same interest rate and deal?

Anyone got experience of this or have a view? Should I be concerned?

mr_mortgage

I'm afraid whilst they were not very nice about it, there's nothing wrong with what they did... had they sent you an offer letter, it would be a different story.

Funnily enough, I remortgaged to HSBC a while ago. Something similar happened in that after I applied the rates went up, but they honored the rate that I applied at.

_Andy_

As you've submitted the application, you should have secured the rate. Ring them to check but I'm sure you'll be fine.

TEDDYRUKSPIN

It depends... did you pay up the booking fee? If so, they have legal right to offer you this rate.

Signing the application means nothing unless the customer pays up first. Unfortunately this is the market due to the moneymarket fluctuating so much.

ziknik

Is this a short term fixed rate mortgage? 2,3,4,5 years?

Assuming you get your mortgage; will you have reduced you LTV to 25% within the fixed rate period?

Sounds a lot to pay (in percentage terms) in a few years to me.

LCK73

TEDDYRUKSPIN wrote: »

It depends... did you pay up the booking fee? If so, they have legal right to offer you this rate.

Signing the application means nothing unless the customer pays up first. Unfortunately this is the market due to the moneymarket fluctuating so much.

They didn't ask for any money upfront.....Have now called them and they say they will honour the rate I signed for as they will for the 100's of other applicants they have....apparently it would be bad for business to pull out........although I was only talking to the call centre staff so have nothing in writing, so fingers crossed.

mr_mortgage

LCK73 wrote: »

They didn't ask for any money upfront.....Have now called them and they say they will honour the rate I signed for as they will for the 100's of other applicants they have....apparently it would be bad for business to pull out........although I was only talking to the call centre staff so have nothing in writing, so fingers crossed.

Glad to hear it - and that's pretty normal behaviour. Banks normally do honour the rate you applied for - it's fair game, and although it sometimes means some hoop jumping (for them, not you) to book the funds it's the right thing to do.

Now, if you just had a KFI and not applied you wouldn't have got the same treatment - but by applying you are showing a level of commitment, so it's only right that they do also.