Trying to get a mortgage is so difficult, I feel like giving up!

[Dudewheresmyrangerover]

I know that lenders have become a lot stricter recently. I thought it might be hard but it’s been a nightmare from the start. Is it suppose to be this difficult?

I’ve been renting for years and always wanted to buy my own place. I put an offer in on a flat two weeks ago which was accepted. I work full time and have been in the same job for the last 6 years. I’m not a huge earner but I do ok, have managed to pay my rent (which is more than what my mortgage will be) every month for the last 5 years. I’m only borrowing 75k. Originally we thought I could borrow up to 100k but they came back and said no as I still had car finance to pay off (only 3k left). A close family member offered to pay it off for me using a credit card in their name and I will just pay them back every month. All sorted. I was told once the car was paid off I could borrow up to that amount but no, I can only borrow up to 79k, wtf?

Luckily the flat I’m purchasing is only 80k so I’m finding the other 5% myself. Firstly the mortgage was declined due to a credit check, no idea why and my broker didn’t either as she checked my credit score and all seemed fine. I’ve never missed any payments. We sorted that. She found me a good offer, 5 year fixed rate, affordable etc. Put the application through which was agreed. I could tell the broker was getting a bit frustrated as they just kept on coming back asking for more information. Finally yesterday all seemed okay, I was sent the mortgage illustration and direct debit form to sign which I then sent back to my advisor. Lender has now come back and said that the offer was based on a government scheme (no idea what that is) which means I’d have to fill out lots of forms and meet their criteria. I asked my broker why that wasn’t advertised before we put the application through/waited for the underwriter to agree etc. Now we’ll have to look for another one.

Every time I think it’s all sorted, they come back with something else. There’s been so many obstacles in my way. I’m wondering if it’s always been this difficult. Just feel so frustrated with the whole process.

Oh mine has nearly driven me to throwing things over the past few months! So many questions and so much paperwork
The surveyor down valued and then they needed me to suddenly clear £700 of debt
And I'm only remortgaging!
It has (crossed fingers) all been approved now so I'm just waiting for solicitors but it's taken (mine is adverse credit) 3 months

@MySecretHistory well I was not expecting that response at all

[quote Dudewheresmyrangerover]@MySecretHistory well I was not expecting that response at all [/quote]
Wrong thread- I have reported myself

@NotMyCat you have my sympathies, it's a bloody nightmare! I'm a FTB and if this all goes through okay, I won't ever be buying again 😂

Not many banks offer mortgages based on 95%ltv but there is a government supported scheme for those with small deposits. I assume that's what has happened? If you had 10-15% deposit you would probably be ok.

Have you checked you've got enough to cover your fees? Solicitors, mortgage/broker fee, survey etc?

If you manage to buy on your own, you've probably done quite well because the whole system is set up for two incomes.

You are in fact lucky their is a government scheme to back your 95% mortgage as these days lenders rarely offer 95% mortgages.
The affordability will take into account any loans as if you have a loan to pay you have less disposable income to met the mortgages.
What you now pay in rent won’t mean anything to them and they won’t take that into account which is a pain but that’s the way it is.

said that the offer was based on a government scheme (no idea what that is)

Sounds like Help to Buy? You wouldn't usually be able to borrow 95% of the value. A >10% deposit is the norm.

Wow that's crazy and annoying. You see lots of people living in 250k homes as starter homes and not sure how now. You've done well to find a flat for 80k. Lowest around here would probably be 150k. Do you earn less than 15k?

I've decided against the government scheme offer as I really don't want to go through more checks, more forms etc.

@sleepyhoglet it's so frustrating! I earn 22k before tax. I only have a 5% deposit but I've saved all that up by myself, no help, taken me a few years to do it.

I wouldn’t be so quick to dismiss the government scheme as you are very unlikely to find a lender who would offer 95% without it.

On £22k it looks like your lender would only lend 4 x Salerno with deduction for your car loan. Do you have any other financial commitment s that they might also be taking into account?
My son is looking at mortgages at the moment and even with a 40% deposit they still asked about phone contract and other regular outgoings ie gym membership, loans

I'm dreading remortgaging in a few years, it was bad enough when I got it a couple of years back. The lender wanted me to clear the £2,500 I had on my credit card. I dug my heels in and refused because it was hotel deposits etc for a big trip which would have been a pain in the arse to get back. They relented, in the end, thanks to my financial advisor - my point was I could clear that today to make you happy, but put it back on tomorrow, so what's the point, it means nothing.

Salary *

Hi, if you have been declined credit you are entitled to understand why this is the case. If you have gone via a broker this might be something historic or even an error? I understand the multiples are tight, and it might just be how you squeeze the finances, but I would check the basics as well. Keep going OP- you will get there!

Having just secured a 95% ltv mortgage, I don't think of myself as "lucky" at all. I earn well, have saved up nearly £30k to cover deposit, stamp duty & fees, but my repayments are significantly higher than if I had a 10% deposit. This isn't lucky, this is a system protecting itself because people mortgaged themselves up to the hilt years ago.

@Dudewheresmyrangerover I've found the process to be really easy due to having a great broker and using a large conveyancing company, but yes there were lots and lots of forms / checks etc to do with the 95% ltv.

Your broker sounds a bit incompetent. There are plenty out there

I'm in the process of moving and porting plus borrowing some extra. The lady in bank breathed a sigh of relief when I had no debt to declare. She said that is what stops most mortgages happening as the payments get taken straight off affordability.

Your broker sounds rubbish to be honest. There are plenty of banks offering 95% not on government scheme and standard income multiples of 4.5 ish x income. I work for one of them and underwrite 95% deals all day long. We do credit score but as long as there are no missed or late payments, you're not in a lot of debt and you can prove you earn what you say you earn then there shouldn't be a problem securing a mortgage. Only thing that could be an issue is the property. If its an ex local authority flat or has increasing ground rent (just a few examples) then it will be a problem at maximum loan to value

We had a 430k deposit and borrowed 70k and it was still an absolute nightmare.
They want everything in every kind of colour and shade.
Very frustrating.

Your broker just sounds a bit pants. You should get value for the fee you are paying her!

It’s so arbitrary. My mortgage was just agreed in a day. All I sent was payslips and bank statements.

The broker did it all.

I wonder if your broker isn’t too great also.

I got my mortgage during Covid so it was a total faff with delays etc, and they took so long to look at documents that by the time they had been assessed, I'd been paid another twice so had to submit more payslips, but I was only on a 19k wage when it was approved. I had to put a 15% deposit down though. I'd saved up 10% but my dad very kindly gave me the extra 5% to see me over the line. 9 weeks for mortgage approval. From offer accepted to move in date was 11 weeks!

I really feel for you OP. It is really tough to get on the housing ladder. I hope you have some luck & secure a mortgage soon. Keep pursuing all avenues.