Should I have declared this?

[stressingsusan]

Dp and I currently going through a mortgage application for our dream home. Provided wage slips, lots of other information and it's all been approved.

I have a loan between myself and a family member that I pay back monthly. It's about £400 a month. I didn't declare this on the application because firstly it's a private loan between family and there's no record of it. And also because when we move and our current house sells I will be able to pay them back in a lump sum so in theory it won't affect our mortgage repayments anyway.

Our advisor recently mentioned I need to provide a bank statement and I'm now worried that this payment will show up and be questioned. Should I have declared this earlier on? Will it affect the application if it comes out? I'm really worried now.

My broker rang me to ask why I have money passing backwards and forwards between 2 of my own accounts, apparently it looked dodgy. I did it because I didn't have the payee details on the other account so would be lazy and transfer money to the one which did.

I think you might come unstuck here, you mentioned paying the loan from a different account and only showing them statements from another one, you can't do this. They will want to see all bank accounts statements, and will know from your credit check that you have more than one account.

You may think you can (and probably can) afford the £400 on top of the mortgage, but the bank have strict criteria. My broker told me of a person who was paying £1700 a month mortgage, and had never missed a payment. The remortgage made this c£1400 so was much less but the bank decided he couldn't afford it!!!

Sorry OP this post is actually the one that's tipped me over the edge of joining Mumsnet instead of just lurking. You sound bloody clueless!

• You should of absolutely declared the loan, it's a large amount of money coming out. I even declared a £200 month payment that I pay to my husband (he paid off my final payment on a car) even though it's due to be done in January

• Secondly I'm sorry to tell you but it doesn't sound like you actually have your mortgage offer sounds like an agreement in principle. We had to provide all our documents /bank statements etc and the offer didn't come through until the bank had done a valuation on the house. Offers can take days or weeks (ours took 3) and you'll know when it comes through.

-Thirdly my advice is don't use the banks solicitor/conveyancer. They're normally bloody crap, you're best off find your own local one that comes recommended. Then that means you can use them for sale and purchase.

-Fourthly what's preventing you putting your current house on the market if your looking for a move in February!? House sales are generally slower over the Christmas /winter period and the average transaction time from offer is 12 weeks ... I would advise get moving.

• Finally I would suggest doing some research on the housebuying timeline , often solicitors are instructed prior to mortgage offers etc because they take so long! There's some really excellent articles on the moving timelines and steps!

Hope this helps and hasn't came across as too arsey, I just couldn't help myself since I'm currently stuck in the house buying process hell.

@AnyBloodyUsername I am clueless I admit it. I haven't been through this process before.

Appreciate the advice. Will speak to our advisor ASAP as the whole process is stressful enough without worrying that the rug is going to be pulled at any point.

This is quite unusual. Is it the broker asking for the statement? I suspect the issue is going through a middle person

We had to provide three months bank statements, I don’t think any lenders look at just one. The bank won’t just go and look at your husbands, they will ask first.

I think you both need to speak to your broker, and find out where in the process you are. The reason he said the only reason it wouldn’t go through was house value is because he was assuming you’d disclosed all loans etc, and the fact he actually refered to it going through, tells it’s not gone through yet. Otherwise he’d not have made the comment. Logically.

As said you both need to speak to your broker or the lender as having this level of confusion isn’t good.

[quote stressingsusan]@AnyBloodyUsername I am clueless I admit it. I haven't been through this process before.

Appreciate the advice. Will speak to our advisor ASAP as the whole process is stressful enough without worrying that the rug is going to be pulled at any point.

[/quote]
You say you haven't been through this process before but also mention selling your current home. Is it mortage free or are you not on the mortage for your current home?

@stressingsusan

Yes it's the same amount monthly and the reference is quite obvious that it's a loan repayment.

The mortgage has already been approved so I'm hoping that if they were doing those sort of checks it would have been picked up on by now. But it might raise questions if I have to provide a full bank statement.

This will be picked up as a regular monthly payment. Speak to your mortgage advisor urgently.

@Whinge it's mortgage free. I'm not going into the details of it as it's personal and outing.

Appreciate all the replies even the ones telling me how useless I am. Will speak to our advisor as a matter or urgency to remove any more confusion. Thank you.

[quote stressingsusan]@AnyBloodyUsername I am clueless I admit it. I haven't been through this process before.

Appreciate the advice. Will speak to our advisor ASAP as the whole process is stressful enough without worrying that the rug is going to be pulled at any point.

[/quote]
I hadn't done the process before this year either OP as my husband had got the mortgage on our previous house before we'd met. But it's not hard to do a little bit of research so you understand what you are getting into. Making a purchase worth hundreds of thousands of pounds isn't something you should blunder into without having a clue- I'm really shocked you are not sure whether you have the mortgage offer or not, how can you not know whether or not you have signed up for the most expensive purchase you will probably ever make? Start with reading posts on the MSE website like this one www.moneysavingexpert.com/mortgages/buying-a-home-timeline/

No, I think it’s fine. My 3 months payslips looked liked I overspent every month: was just before Christmas and I move money between accounts a lot. It didn’t make a jot of difference.

The broker should have picked this up already if it’s on your bank statements. Mine went into the in’s and out’s of all my payments, hairdressers and frequency, personal grooming, how much I pay for parking and travel per month. So a £400 payment more than likely will be picked up and questioned.
Re the Solicitor- isn’t it you that instructed them?

Buying a house can be very overwhelming and consuming the first time so I think you're getting an unfair flaming on here OP.

If you're mortgage has been approved then they will have done a hard credit check so your loan will have come up on there. I'm pretty sure they do a hard credit check on an agreement in principle too so I'm pretty sure they will already be aware of it.

Your*

@tedsletterofthelaw

Buying a house can be very overwhelming and consuming the first time so I think you're getting an unfair flaming on here OP.

If you're mortgage has been approved then they will have done a hard credit check so your loan will have come up on there. I'm pretty sure they do a hard credit check on an agreement in principle too so I'm pretty sure they will already be aware of it.

I wouldn't say it's an unfair flaming at all, buying a house is a huge financial commitment and doing a bit of research about what to expect and the timeline and step by step of buying is a Google search away. (Coming from a person who has googled every element of house buying at this point!)

Also AIPs very rarely use hard credit checks and the loans OP is referring to wouldn't of shown up on any credit checks as it's paying off a family friend so unlikely to show any defaults or affect credit rating.

If they query it just say it’s fully repaid now and cancel the S/O to back it up.

I think the romanticisation of the welfare state in this country is the luxury of those who have taken the benefit of rampant property price increases and/or inheritances. It is easy to be idealistic when you have this safety blanket.

Wrong thread

£400 is a large payment not to mention and it would affect what they will lend you. I think not mentioning it previously could become an issue because it looks dishonest but it may be totally fine.

I have just remortgaged and had to provide payslips etc and 3 months of our joint account. We weren't asked to produce copies of our separate current accounts. We did stay with the same lender though which probably made a difference to the level of scrutiny we faced.

I think the key thing here op is have you borrowed the maximum? Or could you have borrowed more. The question is basically if you earned ten grand a year less (Ie the four hundred a month before tax) would you still be able to borrow the same amount

If yes I doubt anything to worry about, if no, then they may withdraw the offer, because they may see it as you deliberately lied about it and are deliberately lying again saying it’s paid off or will be. You’re also saying your partner will give you the money when they house sells, which doesn’t indicate it’s yours, but the fact it’s not even on the market, does not look promising,

Howver as said, if you’ve borrowed well below the max amount then the 400 won’t make a difference, if you are borrowing at the max it will make a huge difference

@stressingsusan Talk to your broker. This is what they are there for - they'll give you personal advice.

I'd also clarify with them whether you've got a full mortgage offer or not, just so that you know. Instructing solicitors doesn't necessarily mean that it's all gone through; but them asking for bank statements also doesn't mean it hasn't - they reserve the right to ask for more information or request new documents at any point before they send the funds.

@Bluntness100 that is a good point thank you, we are actually asking to borrow 20k less than the maximum offer granted to us so hopefully you are right and even if the loan was taken into account, it wouldn't write us off completely.

My dh wouldn't be repaying the loan, not sure where that came from. But the house is in my name and it does need to be listed soon to get that ball rolling.

Broker has advised that as long as we aren't still paying the debt when the new mortgage starts it shouldn't affect the application. Will come to an agreement with family if necessary. Thanks again for all of the advice. It's a stressful old process!

I think if you’re borrowing twenty grand less than the max you should be alright, and it won’t look like dishonesty as such amd more like not understanding properly.

However I am unsure how they work it, because 400 quid a month is the same as an additional 40- 50k on your mortgage and they definitely felt you could not afford that.

@Bluntness100 yes that's true but the sale of this house will pay off the remainder of the loan so hopefully (providing the house sells relatively quickly) it won't be a long term debt that we carry forward.

Following me commenting on this thread On Facebook I’m getting sponsored adverts saying ‘debt repayment plan for £400 per month’- for a debt write off firm, coincidence Or not? I don’t owe £400 pm personally.

Yes you should have declared it. You have to declare any regular commitments. I had to declare the money I paid my student daughter each month.

@Cheerbear23

Following me commenting on this thread On Facebook I’m getting sponsored adverts saying ‘debt repayment plan for £400 per month’- for a debt write off firm, coincidence Or not? I don’t owe £400 pm personally.

Big brother is out to get you!