Declined Mortgage in Principle - Mild State of Panic

[NerveAgent]

romeogolf said:

Sarnie has given excellent advice, I'm giving my current broker another shot before deciding she's not worthwhile but will keep the thread updated with any details so if anyone else has this experience they can look back at it

I had a mortgage broker cock up an application (twice! Principality and TSB) due to lack of understanding of my self employment/contractor status. I learnt the hard way that they don't always know what they are doing!

I then used a specialist contractor broker who recommended Accord. 8 days after later I had the full offer in my hand, just before Christmas. I don't know if that is down to the broker, the lender or a combination of the 2 but its been a positive experience for me

[dxg]

Could be worse. You could be returning to a previous lender (and life-long bank) with an exemplary credit history and an agreement in principle in hand from them. You could have everything in place, only to then get the 'no' decision.

Safe to say, I will never darken RBS' (or any of their sister companies) door again.

[paulrockliffe]

XMT said:

this happens a lot. My friend went for a mortgage recently and had it planned to have a 5% deposit. He made the application and they found a missed payment due to a bank account switch and because of 15 pounds they asked for a 10% deposit instead.

It wasn't actually because of £15 though was it. It was because your friend switched bank accounts and then didn't check they'd paid all their bills. I'd assume that the bill was chased and either not picked up or ignored. It doesn't matter what the details are or whether my assumption is right or not, because I'm just as uninformed as the lender would have been.

It'll be one of a load of things that effectively marks you as not being switched on enough about your finances for a 95% mortgage.

[romeogolf]

romeogolf said:

My Current Broker said:

I have completed your agreement in principle with Accord, and it has been referred to an underwriter.

This is where the computer says “possibly” but needs to get a human to check the case….

They aim to respond normally within 4 hours.

I shall of course let you know asap.

Sarnie has given excellent advice, I'm giving my current broker another shot before deciding she's not worthwhile but will keep the thread updated with any details so if anyone else has this experience they can look back at it

The decision came back last night that they would lend to us upon receiving proof of the income I get from my rental properties. Have sent my tax return from last year plus 12 months of bank statements last night so hopefully will hear back positively today. They said they'd lend up to £35k more than we need as well, so fingers crossed.

[Sarnie]

dxg said:

an agreement in principle in hand from them. You could have everything in place, only to then get the 'no' decision.

I do try to tell people that AIP's literally mean nothing...........I could get an AIP for anyone with a decent credit score for £1m lending this morning..........but when the full application starts, it's going to unravel if your documents and details don't match up to full lending criteria, which can only be assessed when the full application is submitted and you've sent all your documents to them......

[Sarnie]

romeogolf said:

The decision came back last night that they would lend to us upon receiving proof of the income I get from my rental properties. Have sent my tax return from last year plus 12 months of bank statements last night so hopefully will hear back positively today. They said they'd lend up to £35k more than we need as well, so fingers crossed.

PS: Congrats!

[romeogolf]

Sarnie said:

PS: Congrats!

Thanks!

Sarnie said:

I do try to tell people that AIP's literally mean nothing...........I could get an AIP for anyone with a decent credit score for £1m lending this morning..........but when the full application starts, it's going to unravel if your documents and details don't match up to full lending criteria, which can only be assessed when the full application is submitted and you've sent all your documents to them......

I assume if I provide documents which support what I've already told them, then it's fairly sure I'd be approved? What sort of things could/would they look for in the application which I wouldn't have declared beforehand?

[Sarnie]

romeogolf said:

I assume if I provide documents which support what I've already told them, then it's fairly sure I'd be approved? What sort of things could/would they look for in the application which I wouldn't have declared beforehand?

Nothing is sure until the formal mortgage offer is issued.......

[XMT]

paulrockliffe said:

XMT said:

this happens a lot. My friend went for a mortgage recently and had it planned to have a 5% deposit. He made the application and they found a missed payment due to a bank account switch and because of 15 pounds they asked for a 10% deposit instead.

It wasn't actually because of £15 though was it. It was because your friend switched bank accounts and then didn't check they'd paid all their bills. I'd assume that the bill was chased and either not picked up or ignored. It doesn't matter what the details are or whether my assumption is right or not, because I'm just as uninformed as the lender would have been.

It'll be one of a load of things that effectively marks you as not being switched on enough about your finances for a 95% mortgage.

allright allright! jeez! dont shot the messenger, your not an underwritter for RBS by any chance are you? LOL.
All joking aside things like that can easily happen, its all fine and well saying well you should have made sure etc but life is very busy and sometimes mistakes can happen, trouble in todays world is you seem to get punished for years for a simple mistake.

[mondayo]

Sarnie said:

romeogolf said:

I assume if I provide documents which support what I've already told them, then it's fairly sure I'd be approved? What sort of things could/would they look for in the application which I wouldn't have declared beforehand?

Nothing is sure until the formal mortgage offer is issued.......

Very true, we moved house 18 months ago and it was a right pain.

Our then mortgage provider (First Direct) said they wouldn't even lend us a penny on a new house/mortgage as due to the new mortgage rules, we failed their criteria.
We then had to use a mortgage advisor for the first time. We had AIP in place with Nationwide and thought we had everything sorted and had provided paperwork, then at the very last minute decided not to lend because of our child nursery costs, even though they'd known about them all the time.
Finally ended up with Nat West, as they had the best fit for our particular requirements and they lent us 50k more than anyone else and there were no upfront until we took the mortgage out.

Good luck OP!

[romeogolf]

Sarnie said:

Nothing is sure until the formal mortgage offer is issued.......

I get that, but what would they look for?

[blindswelledrat]

Alex said:

We got declined as my wife owed £1.79 interest on a credit card she thought she had paid off 6 months ago, so it came up as "6 month arrears".

I said, "So we've been turned down for a quarter of a million pound mortgage because of £1.79?"

Absolutely nothing the mortgage advisor could do; he cannot override the system. The computer really does say "no".

My wife phoned the credit card company and they kindly agreed to remove it from the credit reference record. We will apply again in a week or two.

I had exactly the same. I had a dormant account that I had closed (that the bank hadn't done the paperwork on) that had a £5 per month charge on it. I was surprised to be refused a car loan and checked experian and this account had defaulted me every month for 10 months and marked the account as 'delinquent' and my credit score was 300 out of 999 over £20. I was utterly furious. It is a mental system. I got the bank to take off the reports and it jumped straight back to 999.
£20 and one account made the difference between me being considered a near-perfect risk and an utter st bag.

[romeogolf]

Update

Our broker has come back to us today to tell us "I am more than pleased to tell you that your mortgage has now been agreed and will go to offer within the next 24 hours. You will get a paper copy in the post, but as soon as I receive my electronic copy I shall forward you a copy for your information. This means that you can celebrate and your mortgage is now guaranteed! So congratulations!"

Excited faces all round here.

[MX5_Nuts]

^ Excellent! I've got to go through all this palava in 2 months time...

[Phateuk]

romeogolf said:

Update

Our broker has come back to us today to tell us "I am more than pleased to tell you that your mortgage has now been agreed and will go to offer within the next 24 hours. You will get a paper copy in the post, but as soon as I receive my electronic copy I shall forward you a copy for your information. This means that you can celebrate and your mortgage is now guaranteed! So congratulations!"

Excited faces all round here.

Congrats!

I'm currently at the stage where the broker has submitted the application to the lender, did it really take nearly 2 weeks for them to come back with a "yes"?

I've been (possibly naively) sat refreshing my email most of the afternoon hoping that it would be 24 hours or less?

[Dave350]

I'm about to go through this, i'm assuming it's as follows.

See a broker, they look for the best deals and advise which to apply for
Apply for mortgage through broker
Get mortgage in principal
Start making moves on houses I like?

Do brokers often charge upfront or take a %?

[Sarnie]

Phateuk said:

Congrats!

I'm currently at the stage where the broker has submitted the application to the lender, did it really take nearly 2 weeks for them to come back with a "yes"?

I've been (possibly naively) sat refreshing my email most of the afternoon hoping that it would be 24 hours or less?

2-4 weeks is the norm......can often be quicker............can often be much longer, depending on the complexity of the case, the documents and the lenders service levels......there is one lender who are currently taking 6 working days to assess documents sent to them.....and then when they do, they request something cue another 6 days to assess the new document......can be excruciating....

[Sarnie]

Dave350 said:

I'm about to go through this, i'm assuming it's as follows.

See a broker, they look for the best deals and advise which to apply for
Apply for mortgage through broker
Get mortgage in principal
Start making moves on houses I like?

Do brokers often charge upfront or take a %?

I've not seen or heard of brokers charging a % in years..........probably circa 2008/9.

Some brokers won't charge you, some will charge you on application, some will charge you on production of your formal mortgage offer, some will do both, some will charge you once, some will charge you every time you go back to them.............every business will have differing models to suit the way they want to work....

[romeogolf]

Dave350 said:

I'm about to go through this, i'm assuming it's as follows.

See a broker, they look for the best deals and advise which to apply for
Apply for mortgage through broker
Get mortgage in principal
Start making moves on houses I like?

Do brokers often charge upfront or take a %?

The process we followed was.

(1) Contacted broker for a "hi we'd like to buy a house, could you tell us roughly what we could afford?" type chat.
(2) House-hunted based on this. Found somewhere. Put in an offer and got it accepted.
(3) Applied through broker for mortgage. First one rejected, so tried a second one and got approval.

Our broker didn't charge a fee as she receives commission from the lender. There are some who will charge for a consulation, others who charge when you're approved, and others who don't charge at all. Sometimes the ones who charge you will give you the comission (or some of it) from the lender.

Phateuk said:

Congrats!

I'm currently at the stage where the broker has submitted the application to the lender, did it really take nearly 2 weeks for them to come back with a "yes"?

I've been (possibly naively) sat refreshing my email most of the afternoon hoping that it would be 24 hours or less?

Thanks! And yeah, I think 2 weeks is normal.

[Phateuk]

romeogolf said:

Dave350 said:

I'm about to go through this, i'm assuming it's as follows.

See a broker, they look for the best deals and advise which to apply for
Apply for mortgage through broker
Get mortgage in principal
Start making moves on houses I like?

Do brokers often charge upfront or take a %?

The process we followed was.

(1) Contacted broker for a "hi we'd like to buy a house, could you tell us roughly what we could afford?" type chat.
(2) House-hunted based on this. Found somewhere. Put in an offer and got it accepted.
(3) Applied through broker for mortgage. First one rejected, so tried a second one and got approval.

Our broker didn't charge a fee as she receives commission from the lender. There are some who will charge for a consulation, others who charge when you're approved, and others who don't charge at all. Sometimes the ones who charge you will give you the comission (or some of it) from the lender.

Phateuk said:

Congrats!

I'm currently at the stage where the broker has submitted the application to the lender, did it really take nearly 2 weeks for them to come back with a "yes"?

I've been (possibly naively) sat refreshing my email most of the afternoon hoping that it would be 24 hours or less?

Thanks! And yeah, I think 2 weeks is normal.

Ah ok, thanks for the heads up!

Our process was;
Get AIP online from a couple of banks,
As this was way higher than we needed we looked at some houses,
Made offer and did deal with vendor,
Approached broker to sort mortgage

If the online AIP was close to what we needed I may have approached a broker sooner, think we had circa 60k higher AIP than we needed so didn't bother.