Nightmare mortgage search!!

Jaywood89 · 7 January 2018 at 12:12AM

I’ll try to make this as easy to understand but it is quiet a complicated story

So my partner and I are FTB. My partner had an Iva settled in October due to court fees from a custody battle for his kids 6 years ago. We used a broker because of this and a few odd late payments on my file.

We only needed 30% LTV but the broker put us with a company called bluestones who had a 7% interest rate so payments would be £795 per month on £130000 but that’s still less than what my partner is paying in rent and he’s never been late in the 11 years renting. Anyway we were declined by the underwriter on affordability, even with the broker offering for us to cut our outgoings by £500 by paying off a car loan and selling the cars it was still a no. We were devastated as we are about to exchange contracts and just couldn’t believe they turned us down when there’s no real risk involved!! And after they delayed it 3 weeks by asking for more and more info

....so fast forward a week and the broker has decided to to apply in my name only as I have a Experian score of 973 (or did until the mortgage searches lowered it to 940) problem was they would only lend £11900 which is Do able but not ideal. I also work reduced hours while my daughter is under school age (she’s 1) but apparently they are happy to use my child benefit etc as Income so have agreed AIP. My worry is that when it goes to the underwriter the same will happen again even though the mortgage would be 25% of my monthly income. I have a car loan £10955!which I have agreed to pay off and 2 credit cards one at £0 and one at £1500 though this will be paid off this week.
I’m worried as it has been Christmas there’s been a lot of spending on my accounts but I haven’t gone over Drawn, just shopped a lot!. My account conduct has been good for the last 9 months but I had 2 late payments April last year as I forgot to pay on time due to stresses at home caring for my terminally ill mother. Never had defaults ccjs or the like.

It did however occur to me that 8 years ago I had an account with Natwest that went to the FSA as they had applied £900 of charges and never contacted me once in the 2 years to tell me and if was obvious I didn’t use the account. It was all wiped out in the end but I’m worried that will now show aswell on a deeper search and even tho it wasn’t my fault in the end they won’t see it that way

Overall I’m just panicking and need some honest and helpful advice on what to expect. So any feedback would be much appreciated :beer::money:

ACG · 7 January 2018 at 12:33AM

How can you be about to exchange when you do not even have a Mortgage offer? That is normally one of the first steps in the process.

If the broker has done their research there is no reason for you to be declined again. With Bluestone, I would probably have tried to argue it through, but nobody can really give you the reassurance you are after as we have no idea about your circumstances and what your broker has done. Sounds a little harsh but true. You should potentially have options though, I can think of another lender or 2 who would consider your application.

Jaywood89 · 7 January 2018 at 12:39AM

Hi sorry should of explained we had an AIP from bluestones and have contracts to hand but unsigned as we can’t sign and exchange them without the official offer. My solicitor is a friend so he’s been very quick and efficient

CommitedToChange · 7 January 2018 at 12:39AM

So you did all searches etc without a firm mortgage offer? And your broker was ok with this, this seems quite reckless in your financial position.

As ACG said a mortgage offer is step one and you can't be about to exchange if you didn't even have that.

Are you only 3 weeks into the process a sign you say the mortgage company delayed by 3 weeks. When did you offer on the house?

Jaywood89 · 7 January 2018 at 12:45AM

Sorry I’m abit confused I thought an AIP was what you needed to begin a house search? Which is what we had when we started searching. I thought u do a full application when you have had an offer accepted on a house?
I researched how to buy a home extensively before beginning and all the places I searched advised an AIP is what you need at the searching stage! Is this wrong?
And sorry if I was unclear the application was sent end of November and we were declined on Thursday of this week so more like 6 weeks in total. Hope that’s cleared it up

ACG · 7 January 2018 at 10:29AM

You do not need an AIP to being searching and/or make an offer although many agents will push for one.

Once your offer is accepted you make a full application.

Once your application goes to offer, you then start the legal work.

Once the legal work is complete you then set an exchange date.

It seems you started all of the legal work far too early in the process. You have potentially wasted a few hundred pounds by doing the legal work before having a firm mortgage offer. An AIP is not really worth the paper it is printed on.

csgohan4 · 7 January 2018 at 10:30AM

An AIP does not mean you will get an offer. Some AIP's are not worth the paper they are printed on.

You have been misguided by your so called friend solicitor. No searches and costs for a house buying project should be done until you have a mortgage offer generally. You got taken a ride by friend who have advised you incorrectly for a quick buck.

You get declined and you lose all the money for survey's solicitors e.t.c.

You really need to think this through and see through the 'it's cheaper than rent' and look at the bigger picture.

Do some more research on buying a house.

https://www.moneysavingexpert.com/mortgages/mortgage-guide

Bottom line is you are a real risk than compared to someone with no IVA's, no defaults and no debt.

Every AIP your broker does, impacts on your credit history negatively as well. I never got an AIP when I offered on a house. my Broker advised me correctly

Jaywood89 · 7 January 2018 at 11:04AM

Thanks for your feedback.

The estate agents wouldn’t accept the offer without the AIP and an appointed solicitor which costs £400 upfront anyway. I get what you are saying though, there seems to be a lot of misleading info being given to me. My solicitor has given me the paperwork to sign for when the formal offer is made. So maybe I’m confusing the level it is at. He hasn’t set and dates with the seller etc.

Also just a note. I don’t have any Iva’s, defaults or ccjs. My partner did. But he is no longer on the application.

One thing I’m interesting in knowing however is how much deposit affects likeliness to lend? I have 70% deposit I’ve read that some issues are overlooked dependant on size of deposit but I’m not so sure how true that is.

Jaywood89 · 7 January 2018 at 11:07AM

Also the reason I mentioned rent was because that is the what bluestone look at as they don’t use credit scores to check suitability. It’s on affordability he seems why I was surprised they declined when my partner proved he’s never missed a rent payment

ACG · 7 January 2018 at 11:26AM

Bluestone do not use your rent to assess affordability? They have an affordability calculation like all lenders.

With a 70% deposit issues such as bad credit can be overlooked, but if it does not pass affordability even a 99% deposit is not going to get you any more.

This sounds like a bit of a messy application, I am not sure I agree 100% with your broker but I think you should either stick with them or find a new one. Sometimes getting help on a forum can cause more problems and stress. Too many cooks and all that.

Jaywood89 · 7 January 2018 at 11:43AM

I think I agree with you on that lol. If I’m honest I am feeling like I would like to use a different broker but I’m worried I’m too far down the rabbit hole with them now. We went with them due to my boyfriends previous IVA as they are bad credit specialists and a lot of people looked at our combined files and said he was going to be the issue. Had I known I could do it alone I would of just done it that way to begin with.

But thank you your honest advice is helpful. Sometimes it pays to hear it from
Someone who isn’t being paid to tell you what you want to hear

Nightmare mortgage search!!

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