Decision in Principle different to Actual Mortgage
Discussion
Literally as the title.
Looked at a few properties but with the new scam of "Open day followed by offers in by 12pm Monday" that all the agents round here are running. They want evidence of a DIP as well as Funds (makes sense) So went to Nationwide where I've had a savings account since I was a teenager and where my deposit was being stored. (Bank with Natwest) had a DIP with the branch manager. All seemed OK. He gave me a certificate to say they'd lend me 145 over 25yrs based on my payslips and outgoings. Monthly repayments are well within budget etc. Great. Made an offer on a place. Was accepted after haggling it under list. Made an appointment to go back and see the Mortgage Advisor proper and get it all signed off.
So Nationwide do this by videoconferencing. So I'm sitting in Surrey with the other guy in Fife. "Anything changed since your DIP?" he says "Yes, I need 148 as the property was too good not to push a bit"
"Ok shouldn't be a problem" In my mind I know I don't NEED this extra, the Bank of M&D have hinted they could step in. But I'd rather just pay the extra £ over the 25 years. They've already agreed to pay for appliances so I'm already taking the piss! So we go through all the paperwork again, talk money etc. And then he asks about the Council Tax bracket. We can't find the exact number on the web. So he goes with what he expects it to be. All OK in my mind. Then the computer makes the silent noise!
"oh" he says. "According to our criteria we can only lend you 134 over 25 years! Seems to be the council tax that's made the difference
"FFS I made an offer based on your DIP!"
So he does some more calculations, puts me on hold etc etc And comes back to say they CAN lend me the 148 but it'll be over 34 years. There's some faffing and we agree I'm going to me making regular overpayments it will be done in 25 years anyway.
Now the repayment amount over 34 years works out at 27% of my take home per month. And with the overpayments it's 32%. Hardly a huge difference. He also said there's a chance that after the initial term I'd be able to show I've made overpayments and adjust it all to what I want anyway.
I suppose my questions are really, how common is it to be told 1 figure then have it change? Or was I duped a bit to a product he was getting better incentives for selling me?
He was clearly leading me towards a few answers/choices. One that sticks in my mind was Tracker vs Fixed (Was thinking Tracker for the first bit but went fixed) and then length of initial term (I was thinking 5 went with 3)
Over to those who know more about this than I.
Looked at a few properties but with the new scam of "Open day followed by offers in by 12pm Monday" that all the agents round here are running. They want evidence of a DIP as well as Funds (makes sense) So went to Nationwide where I've had a savings account since I was a teenager and where my deposit was being stored. (Bank with Natwest) had a DIP with the branch manager. All seemed OK. He gave me a certificate to say they'd lend me 145 over 25yrs based on my payslips and outgoings. Monthly repayments are well within budget etc. Great. Made an offer on a place. Was accepted after haggling it under list. Made an appointment to go back and see the Mortgage Advisor proper and get it all signed off.
So Nationwide do this by videoconferencing. So I'm sitting in Surrey with the other guy in Fife. "Anything changed since your DIP?" he says "Yes, I need 148 as the property was too good not to push a bit"
"Ok shouldn't be a problem" In my mind I know I don't NEED this extra, the Bank of M&D have hinted they could step in. But I'd rather just pay the extra £ over the 25 years. They've already agreed to pay for appliances so I'm already taking the piss! So we go through all the paperwork again, talk money etc. And then he asks about the Council Tax bracket. We can't find the exact number on the web. So he goes with what he expects it to be. All OK in my mind. Then the computer makes the silent noise!
"oh" he says. "According to our criteria we can only lend you 134 over 25 years! Seems to be the council tax that's made the difference
"FFS I made an offer based on your DIP!"
So he does some more calculations, puts me on hold etc etc And comes back to say they CAN lend me the 148 but it'll be over 34 years. There's some faffing and we agree I'm going to me making regular overpayments it will be done in 25 years anyway.
Now the repayment amount over 34 years works out at 27% of my take home per month. And with the overpayments it's 32%. Hardly a huge difference. He also said there's a chance that after the initial term I'd be able to show I've made overpayments and adjust it all to what I want anyway.
I suppose my questions are really, how common is it to be told 1 figure then have it change? Or was I duped a bit to a product he was getting better incentives for selling me?
He was clearly leading me towards a few answers/choices. One that sticks in my mind was Tracker vs Fixed (Was thinking Tracker for the first bit but went fixed) and then length of initial term (I was thinking 5 went with 3)
Over to those who know more about this than I.
Edited by Rich_W on Sunday 4th October 13:34
From what I can see, all thats changed is that you've now given information (council tax figures) that has impacted your affordability hence the reduced loan amount over 25 years, but was then able to get it back £148k over a 34 year term...
Not sure what the issue is? You've given additional information to them after the DIP.
Not sure what the issue is? You've given additional information to them after the DIP.
I was just surprised tbh. I could understand if I'd told them the property was BTL or inhabitable at the moment or any number of other things that weren't known at the time of the DIP.
Surely everywhere has council tax to consider. And this property is not the highest rate or anything silly. Seemed odd THAT would make a difference.
No great problems really. Just as a newbie, wanted a second opinion. Cheers
Surely everywhere has council tax to consider. And this property is not the highest rate or anything silly. Seemed odd THAT would make a difference.
No great problems really. Just as a newbie, wanted a second opinion. Cheers
Just a little update.
Nationwide phoned me yesterday, apparently after looking at my payslips again. They can do the same value mortgage over 21 years if I wanted. We discussed repayment options and we've gone with 23 in the end. I had a mental block with anything over a certain amount per month and 21 years would have gone above that.
Thanks WestBerks. Fingers crossed.
Nationwide phoned me yesterday, apparently after looking at my payslips again. They can do the same value mortgage over 21 years if I wanted. We discussed repayment options and we've gone with 23 in the end. I had a mental block with anything over a certain amount per month and 21 years would have gone above that.
Thanks WestBerks. Fingers crossed.
Edited by Rich_W on Saturday 10th October 17:46
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