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Original poster

Are banks lending less for mortgages?

17 replies

ballsdeep · 19/09/2020 21:45

I am in the process of moving and am just about to put my house on the market.
I did an AIP with one bank a few weeks back and were given a good figure. I did this without adding in my husband's overtime and bonus which is approx 10k.
Tonight o tried with another lender, including the overtime and was allowed 120k less?!?
Is this normal for banks? Nothing else has changed, all the exact same details!

OP posts:

Original poster

ballsdeep · 20/09/2020 06:40

Anyone?

OP posts:

LongPauseNoAnswer · 20/09/2020 06:43

A friend is just starting the mortgage application process and can’t get a bank to accept less than 20% deposit usually it’s minimum 10%. There’s something going on!

Idontgiveagriffindamn · 20/09/2020 06:48

All banks have a different approach to risk and therefore will lend different amounts. Depending on what the factors are this can differ wildly.
6 years ago a bank would lend me over £100k more than a building society.
10% deposit mortgages were pulled a few months ago due to Covid - doubt they’ll come back on the market until they know the effects of Covid in the housing market.

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chattycathy83 · 20/09/2020 07:10

Yes a lot of lenders have reduced the amounts that they are lending as well as increasing the deposit required. Every lender is different though, it may take a bit of shopping around to get the amount you need and I would find a good broker -getting a mortgage can be a nightmare at the moment.

2ndAugust · 20/09/2020 19:42

Deals available are also changing on a daily basis. Do you have a broker? I’d suggest speaking to them, we have had AIP’s for clients only to have the rug pulled from under them/us when we have gone to progress it. If you have more than 20% deposit / equity for the new place you will be less affected, and similarly if you are employed rather than self employed you will be better off.

TapingTheTop40 · 20/09/2020 19:45

My friend who is a first time buyer and had her 5% deposit ready can no longer get a house as all banks are only accepting a minimum of 10% now.
She said it came in around June.

Original poster

ballsdeep · 20/09/2020 20:02

@2ndAugust

We haven't got a broker yet and more than a 20% deposit . I am so nervous to move at the mo tbh. I think I am going to put the brakes on

OP posts:

2ndAugust · 20/09/2020 20:39

If it somewhere you see yourself staying for 5 years plus I’d just carry on as normal, brokers are really worth it, and some don’t charge any fees. They can shop around and get you the best deal and have preferencial rates. So many people are moving at the moment with no problems, it’s those with small deposits trying to get on the ladder that are struggling. Plus the lack of stamp duty makes it a great time to move.

TinyBarista · 20/09/2020 20:41

DP is a broker. Lenders understandably tightening up due to effects the pandemic has had on the economy I.e ahead of the run out of the furlough scheme, inevitable redundancies. It's all about acceptable risks of applicants.

Bemyhat · 20/09/2020 20:44

Yes we think so too!

We want to move and sell to a FTB! But the banks want to lend us less than we had 2 years ago despite salary increases. Tried to get an AIP today!

It’s not even as easy as “just port the mortgage” anymore.

Something definitely going on and Shatwest stood out as being the worst. Santander less so.

Bemyhat · 20/09/2020 20:46

We have more than 20% deposit too. We aren’t FTB

Original poster

ballsdeep · 20/09/2020 20:47

@Bemyhat

Yes we think so too!

We want to move and sell to a FTB! But the banks want to lend us less than we had 2 years ago despite salary increases. Tried to get an AIP today!

It’s not even as easy as “just port the mortgage” anymore.

Something definitely going on and Shatwest stood out as being the worst. Santander less so.

We could borrow more than the lesser AIP when we first had our mortgage 15 years ago and were on half our salaries!!! It really shocked me. We have excellent credit scores, good jobs, although my husband's is in sales so maybe that is why?

OP posts:

Beaniebeemer · 20/09/2020 21:32

Has anyone had to do a product transfer recently (staying with the same bank but going on to a new deal).

2ndAugust · 21/09/2020 07:09

Product transfers are still pretty simple, although the automatic valuation they do to work out your loan to value has sometimes come out lower than clients would like, they have then arranged a physical valuation in order to get the best deal. I just did mine with santander which was quick and I got offered a good rate.

Dazedandconfused10 · 21/09/2020 07:34

Yeah. I'm going to have to sell now and move to a cheaper area rather than be able to remortgage and take my ex off the deeds. To keep the property would need to stump up another 30k due to the max ratio the bank will lend against my earnings.

Crazy that would make my ltv around 60% and my mortgage tiny. But not worth losing all my savings

EmbarrassedUser · 21/09/2020 07:48

Use a broker. The fee is annoying but they will almost certainly find you something and the fee will be worth it. Our broker found us one this time where the monthly payment was £170 less and, looking through the paperwork, because of the lower interest rate we save around £100k over all 👍

FAQs · 21/09/2020 07:55

Yep, two weeks ago I was offered £71k more than I was at the end of last week.

I’m a mover, 27% deposit, with luck I only need the lower amount but wanted more for refurbishment. Nothing has changed, outgoings the same, income the same, excellent credit rating.

I’ve sold to a first time buyer who is struggling now so I’ve not started the packing process yet. Apparently the average time now is 4 months. I have a broker.

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