...to be so upset but mostly angry that I've been turned down for a mortgage

[thebiggestloserinthenorth]

Hi all... Single mum here. I've been saving for years to try and get some money for a deposit as so much bad luck with renting. Was gifted some money by a relative.
Finally got a 'yes' decision in principle from a lender through a mortgage advisor (shared ownership) and so happy as just want stability for me and my child. Today I heard that they've now refused the mortgage application based on some of the deposit being gifted?
I have zero debts, a decent job and am so upset about this.
How are you meant to get on the properly ladder if you don't get gifted money?
Feel so deflated now.
AIBU to feel so angry... also have shelled out nearly £1000 in fees (holding fee & mortgage advisor fee..)
😢

a good mortgage broker should have knowledge of which lenders don't look unfavourably on certain variables - shared ownership/gifted deposit, etc. Isn't that the point of using one?

Morning all
Thanks again for all your comments.
So grateful.
So the MB has just come back to say another lender has given a decision in principle.
They have said there's a £200 fee up front (to the lender) and it's a rate of 3.99% and there is a set up fee that is added to the mortgage...
Does any of this sound bizarre to anyone?

What is the £200 fee for if the mortgage is not guaranteed? Also that seems like a high rate - did you go for a fixed rate or flexible?

Would also highly recommend www.landc.co.uk/ - they are free so no risk to you if you want to try them.

I personally don't trust brokers that charge - they're double-dipping getting paid by you and commission from the lender! A friend of my DP recommended a broker who wanted to charge us £200 just for a phone call to see if we wanted to engage his services. Eh, no ta.

I would talk to another mortgage broker, honestly. I am sorry for those people that have had bad experiences, unfortunately there are good and not so good and downright bad in all professions and walks of life but a good broker will be worth their weight in gold, for life (well the length of your mortgage!)
The new mortgage product sounds feasible, but it doesn't sound like the broker is explaining it properly to you- arrangement fees and valuation fees are perfectly commonplace but should be explained and compared to other products available to you- and i refuse to believe there is only this one, if your situation is as you describe.

And to the people saying to go with fee free because they charge the lender- so do those that charge a fee! Some brokers charge huge fees and will also get a commission from the lender.

I have been associated with the industry for decades and the brokers i know explain and justify their reasons for recommending a product to the client irrespective of the commission they receive (which for most situations the difference between lenders is negligible anyway).

Best of luck with your property purchase OP, it isn't you, its them, and i really hope the process is stress free from here and
you are settled in your new flat before long!

DD completed on her house 2 weeks ago with her deposit 20% her savings and 80% a gift from us. The gifted part had to be put into her account before the application went through. Her mortgage is with Santander.
Keep pushing your broker!

You do usually have to pay a fee for the mortgage - there is an online calculator which helps you work out the overall cost. So for example if you pay the fee upfront there will obviously be a lower cost than if you add it to the mortgage. If possible I always choose to pay them upfront but understand not everyone can do that. When we remortgage there were several different mortgages which were very close together and it was the fee that made the difference between which one we chose. I would also add that although I used to broker I did my own online research as well to check that they were getting us a good deal. Sounds like you’re making progress, fingers crossed.

I should just add that I was another one who recommended London and country, the second time they looked for a mortgage for us they worked really hard but couldn’t find anything better than we had found. They were still really polite even though they got nothing from it. I would definitely go back to them again.

Even within the same brokers you can have a different outcome. The first broker we spoke to just said we didn't have the money so couldn't get us a mortgage and we should just try again the next year! When dh phoned again, he spoke to someone else who bent over backwards to find us a deal and he did! Sadly, he is no longer there and we have to renegotiate in a few months. Hope we get someone who is as helpful as he was.

I am middle of remortgage at the minute and this is what I have paid (using a broker) but it depends on so much. If it's an easy mortgage with good credit history then I would have had a much lower rate and not paid a broker...

My dd was turned down after an agreement in principle from a small building society they already had a mortgage with. When she took out this mortgage I gifted towards the deposit and merely signed a form stating I had no interest in the property.

They turned down on a £220,000 mortgage because they only had a 10% deposit and had made a late payment (when her dh suffered a bereavement) which was paid in 24 hrs. It is a huge red flag to lenders no matter the reason. They asked it was looked at again and it was the same decision. I know they were very upset, but it really was the wrong property at the time.

They went to another lender - Santander - who had no issues at all. They are staying put and remortgaging to them at a lower rate.

Have you approached any lenders - preferably the larger ones - yourself op? I don't think this is insurmountable. I hope you get your flat.

The broker should be able to provide you with a key facts illustration outlining ALL fees and when they are due before you part with a penny.

Any of them can agree in principle dont give any money over to you have a firm yes

YANBU. Get a letter from the person who gave you the money saying it’s not a loan (we did this) and try another provider. Keep trying yourself and with mortgage brokers until you get a yes.

Try Barclays and Nationwide if you haven’t already.

I have zero debts,

When I applied for my first mortgage, my broker told me that this would count against me as there wasn’t any record of me servicing debts reliably.

I would recommend L&C too, in fact I'd recommend talking to any other mortgage advisor for some independent advice (it would read from your posts that your mortgage advisor is linked to the building company?) as to what's normal and what's not. I've done two mortgages and never been asked for a fee upfront.

Good to hear recommendations for L&C as we are just looking at finding a new broker for our remortgage. The company we used before were fee for the first mortgage but for a remortgage it's £485! L&C have been recommended by Money Saving Expert, along with TSB (I think it was?) and Santander.

My current broker doesn’t charge and he’s excellent. I bought my first flat with a chain of well known brokers, and they charged, were really unhelpful and the guy I dealt with was very poor with communication and advice.

It sounds odd that you’ve been rejected for a gifted deposit, I had about a quarter of mine gifted and it was fine. Definitely get independent advice.

Can I explore with another MB at same time? Or independently?
Will that affect anything, does anyone know? 🤔
This thread has been a game changer. 🙏🏽

@thebiggestloserinthenorth

Can I explore with another MB at same time? Or independently? Will that affect anything, does anyone know? 🤔 This thread has been a game changer. 🙏🏽

Another vote for London and Country. They charge you nothing as they charge the lender.

Yes you can speak to whoever you want. Shared ownership are notorious for getting you to go with their broker and very often the broker is tied.

I do mortgage admin for a broker and while we do charge a fee for advice (on offer) we have access to most of the market.

And for all those saying you earn from the lender. Yes we do. But on a 100k mortgage it might be around £200 that we earn. So if you write 8 mortgages a mo th that’s only £1600. Which isn’t enough to cover costs.

Also your broker doesn’t have to disclose what they get from the lender. By they have to if you ask them. (As per FCA regulations)

@longtompot
"we have to renegotiate in a few months."

Hi longtompot - do you need to change the amount of borrowing? If all you want is to get a new deal on your existing mortgage then check out the deals offered by your current lender for existing customers. That way you avoid making a full application/having to provide evidence etc. It's usually just a product switch to the best deal for you.

Thank you @Winter2020 I didn't know that. I'll let my dh know and we can go from there. I just assumed we would have to remortgage.

Talk to another broker. And there’s loads of great advice about mortgages on the Money Saving Expert forums. You will get there.

@NotMyCat

I am middle of remortgage at the minute and this is what I have paid (using a broker) but it depends on so much. If it's an easy mortgage with good credit history then I would have had a much lower rate and not paid a broker...

Your broker is charging you £2495?! I've never heard of such a high fee - max we've ever paid is £500. How is it costing you so much?

Nearly spat out my tea at the 2.5k for a broker!! Mine was £450!

I bought my flat last year. Originally had a 10% deposit that I'd saved up myself, but due to Covid etc, the lender asked for a 15% deposit. My dad gave me the extra and all he had to do was fill in a form saying it was gifted and he didn't want it back or want any stake in the property. We then had to send over the solicitor a proof of where my dad got the money (his lump sum from retiring, so we just sent them the letter from his work confirming the amount of his funds) , a screenshot of it being sent from his bank to mine, and one from mine showing it being received from his bank.
Nationwide accepted, no questions asked.