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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

First mortgage application - reassurance/advice needed!!

72 replies

PartyRat · 03/03/2016 20:12

Hi all! Long time lurker, first time poster. About to submit our first mortgage application and need some wisdom! Smile

Boyfriend and I rent a lovely flat that's perfect for us. Our landlord knew we were looking to buy (eventually) so offered us the flat and accepted a bargain price. So off we went to the mortgage broker, and here's where my AIBU starts.

Because this happened a lot sooner than we expected, my finances aren't particularly great - leftover student overdraft of £2.5k which I'm always in, monthly wage isn't enough to bring me out of it. Credit card with about £450 outstanding, but the broker said that shouldn't pose too much of a problem. Sent the broker my 3 months bank statements and was told 'there could be a problem' as I was constantly in my overdraft and there was one charge for unarranged overdraft use (annoying as I had money in another account which could have covered it Blush )

I am hugely worried about our application in light of this. It's a joint mortgage application, and I'm really worried that we will be declined because of me Blush Boyfriends accounts are good, no overdraft, no credit card, no student loan etc. The affordability calculator said we could get around £209k but we're only asking for £166k which I hope helps it?

AIBU in being so worried, or is it likely to be declined? It feels like we have even more pressure than a normal mortgage application as if it's declined our landlord will need to sell to someone else leaving us without a flat!! Please let me know what you think, might calm me down a wee bit....or maybe not!

OP posts:
Bearbehind · 03/03/2016 21:05

Wrong - I don't advise.

I'd be interested in how those in your company that do advise, view you saying you work for them and pointing people in a certain direction on the Internet with very limited facts Hmm

Original poster
PartyRat · 03/03/2016 21:07

Guys I'm already stressed enough as it is, please don't have a row Sad I don't think I can handle that on top of this haha!

OP posts:
TapDancingPimp · 03/03/2016 21:09

"Op, you're not really in a position to be fighting for the best rates. I'd be more focused on getting the best lender for your circumstances"

How exactly is what you said in any way different to me, other than my ability to actually name the lender?!

Gracey79 · 03/03/2016 21:10

Grin party. One other thing to consider is looking at your own bank, I know account is overdrawn etc but if you've had no missed payments before and have been there a long time that would all usually count in your favour.

TapDancingPimp · 03/03/2016 21:11

And, I seriously doubt OP will totter off to fill out a Hali application based on a stranger's internet advice Smile

Bearbehind · 03/03/2016 21:11

Sorry, OP.

Have a mooch around on MSE as I'm sure there have been lots of instances of automatic decline for overdraft use with nat west.

If you want to go ahead, one application/credit check isn't the end of the world, but if that fails, I'd look for another broker who really analyses your case before you make any more applications.

Bearbehind · 03/03/2016 21:16

tap my point is that as you are in the industry, you're not allowed to name lenders.

I'm not in the industry and don't have the knowledge to name lenders, only to make generic comments.

It's not rocket science to know that the best rates are reserved for the least risky borrowers, so if you have any stumbling blocks your focus should be on a lender who views these the least dimly, not one who offers the best rate. Hmm

Original poster
PartyRat · 03/03/2016 21:16

Bear, no worries, I just didn't want the guilt of Internet drama on my conscious!!

That's a good point that you (and I think someone else) made about analysing the case more thoroughly.... That didn't even occur to me before now embarrassingly. I guess I just trusted him because it's my first experience with anything like this - stupid I know!

OP posts:
Original poster
PartyRat · 03/03/2016 21:19

Also, the reason I decided against the higher rates was because it was SO much higher - over £100 a month. I'm sure that would make a dent in anyone's monthly budget! I knew there would be no point in applying for a mortgage with someone, despite them being more likely to grant the mortgage, if we couldn't afford to live comfortably with the repayments!

OP posts:
TapDancingPimp · 03/03/2016 21:22

Exactly, and at no point did I recommend OP aim for the best rate!!

What I did do is recommend her broker seek out an appropriate lender who won't be blinded by overdraft usuage.

Wrists slapped for naming the lender.

Don't give lose hope, OP. It is possible. And in fact yesterday we did have a case were a year's proof of rental payments was requested so thumbs up to you if you're able to provide this, it's seen as a huge plus for many lenders (but I won't say who Wink)

Bearbehind · 03/03/2016 21:22

It is totally ridiculous party, much like pay day loan interest rates- those least able to afford it are forced into paying the highest interest rates.

TapDancingPimp · 03/03/2016 21:22

Excuse the random 'give'!!

TapDancingPimp · 03/03/2016 21:23

Where* a year's, Christ!!!

Bearbehind · 03/03/2016 21:25

Wrists slapped for naming the lender

Fair play tap. I think we're both making the same point anyway Grin

TapDancingPimp · 03/03/2016 21:26
Smile
Usernamegone · 03/03/2016 21:30

Is there any way you could get together enough money for a 10% deposit as lenders seem to be a less picky than for a 5% deposit. I got my first mortgage in Jan 2015 and there was a 1.5% difference in the interest rate between 90 and 95%!

Alternatively, is there any way your landlord would wait a month or two to give you time to tidy up your financial affairs/overdraft/bank statements?

I presume you have applied for a AIP or is it the full mortgage app? Fingers crossed! Whist waiting for my AIP it was the most nerve wracking 72 hours of my life!

Tequilamockinbird · 03/03/2016 21:37

We got our mortgage through Woolwich. 5% deposit, first time buyers and both live in our overdrafts. We also have approx £20k unsecured debt between us.

So, it is possible. We borrowed towards the top end of our affordability bracket too.

Good luck.

Bearbehind · 03/03/2016 21:40

How long ago was that tequila?

Things changed massively in April 2014.

WhimsicalWinnifred · 03/03/2016 21:59

If natwest decline, try another lender. You may have to go with a sub prime lender and pay more but once you're in, you're in. Our first mortgage was with Kensington mortgages. We paid slightly more for the privilege but it was worth it. My concern is the low deposit. I saw mortgage deals with low deposits (like 10%) but we had to put a minimum of 20 down each time.

Original poster
PartyRat · 03/03/2016 22:10

Yeah, it would be the agreement in principle we'd do first. So we'll see how that turns out!

I wish we were applying pre-financial crisis when you could just turn up and they'd give you however much you wanted haha!

OP posts:
Tequilamockinbird · 03/03/2016 22:16

Bear, it was June 2013. I've no idea what the changes mean but we're due to remortgage this year so hope they don't effect us negatively now Shock

Original poster
PartyRat · 04/03/2016 09:10

So I've been looking back at it now that I've had a good nights sleep (and my heads not as fried!) We're applying using the natwest help to buy scheme. They ask for a minimum of 5% deposit, but you're not allowed to put down any more than 10% deposit, so I'm thinking that maybe our 5% deposit doesn't look as bad after that?

I suppose, we can only apply and see what they say. It will just be so embarrassing if we get declined because of me Blush

OP posts:
scribblegirl · 04/03/2016 09:25

Partyrat we're in the same boat! Applying for our first mortgage and due to hear back on the application today. We're applying through a broker too. DP has a squeaky clean record, mine is 'OK' according to my credit report but I've only got out of my overdraft in the last couple of months and have a pretty heavily used credit card - I'm equally terrified of having to tell him that it's all my fault we can't borrow Confused I did highlight the OD thing to our broker and he was recommended by a friend so I can only hope he knows what he's doing....

Good luck Smile

Bearbehind · 04/03/2016 09:35

The problem is party HTB rules are stricter than other lending for the very fact that they do involve very small deposits. The affordability and stress testing in these products is pretty tough.

If you are confident your broker has worked all this out and believes you do meet NatWest's criteria then go for it but it would be worth asking him a bit more about the analysis he's done so far.

I'd hope he's done a bit more than see Natwest do HTB loans at a decent rate.

Good luck.

Bearbehind · 04/03/2016 09:40

This is one of the MSE threads I was thinking of

forums.moneysavingexpert.com/showthread.php?t=5220226&highlight=natwest+overdraft

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