Refused remortgage - what to do

[notbeenagreatday]

I've posted in legal too but thought might be some more advice over here

So under the terms of my divorce I'm due to pay ex husband a sum of money next year. I am in the family home as have young children and always earnt 3x ex so can cover the mortgage easily.

Was mulling over moving house so rang to discuss with my current mortgage provider today - who after doing a soft check flat out refused to offer additional borrowing on my current mortgage to pay him so I can't move and I can't do additional borrowing!

I'm shocked. They said they based it on my Experian Report - but I've duly registered and my credit score is 1000/1000 - literally cannot improve on it.

What am I supposed to do? They said it could be due to ex husbands credit rating (they are so wishy washy with what they are allowed to say) but I have no control over whatever debt he might have had if he used this house before he moved out as the registered address other than asking him to change the address details? I can't ask him to run his own credit report - we don't have that kind of relationship?

My salary is circa £85k per year and my current mortgage is £170k and I need £60k so well under borrowing multipliers

I re fixed at the end of the last fixed deal so that has 4 years to run without incurring early redemption so can't change lenders.

Book an appointment with an independent mortgage advisor.

You may be able to port your mortgage over to a new provider and borrow an additional amount.

Speak to a mortgage advisor?

Speak to an adviser.

How much is your house likely to be valued at?

They said I could port but refused to allow additional borrowing - so I'd have £60k LESS and there is nothing in this area (or anywhere nearby) which gets suitable home

Plus if I move to a new provider won't there be an early redemption fee?

House has been valued at £350k

You need to speak to an advisor.

It's not uncommon to need to move provider if your circumstances change.

Try for as high a personal loan as you can, put all your everyday spending on a zero percent credit card, and hope to remortgage at the end of your fix?

Probably not great advice but if I was desperate to be financially severed from an ex that's what I'd look to.

@YumiZumi

Yes I'm wondering if that's what I'll end up having to do - I've never seen personal loans of £60k advertised though but I suppose I have a year to find one

In the mean time I've asked Equifax to put a note on my file that myself and ex are officially divorced? Don't know if that's going to do any good?

I've asked him to make sure that any store cards etc he has that he updates the address - I've basically said if he doesn't do that then there is no money

A 230k mortgage on 85k is a lot. You are pushing it. How many years would it be over?

They’ll scratch your eyes out but a second charge from a sub prime lender might raise the cash…as a very very last resort.

You need to check all the Credit Reference Agencies - mortgage lending is not often single bureau - and check for any discrepancies.

Also if you think the issue is your ex then you need to break all shared financial commitments that are registered with the CRAs - that is break the financial relationship after which his credit history is irrelevant.

If the mortgage is the only joint financial commitment / will be the only one remaining then that conversation can be had with an underwriter by you or a broker.

@Janedoe82 26 years. I didn't think it was that much? The usual multiplier is 4x income which I'm well within?

@PinkGinny

Thankyou. Forgive my ignorance but if I went to a broker would they approach my current lender and underwriter?

Probably unlikely, but you could see if your mortgage holder will let you take out a second mortgage with someone else. You could also get a mortgage with a different bank big enough to cover the early redemption fees plus the money you need. Depending on what other options you have and how much this will be I'd consider doing this. Any chance your ex would agree to you paying the money to him in regular instalments over a year or two? Obviously depends if you could afford that. Any redraw available on the mortgage? Haven't fixed before so I don't know if fixed mortgages can have redraw facilities.

Yes but you have three children. If you have told them that it brings it down.
Your mortgage would be about 1300 a month. I assume you take home 4K? That doesn’t leave a huge amount if you only have one income coming in.

And also depends on other debts? Credit card/ bank loans/ car loans.

@PinkGinny

yes the only joint financial commitment is the mortgage. I can't remove him from the mortgage and sever ties completely with him without equity release but they won't allow the equity release 🤔

The credit search company and the bank have said the credit search is done on the property I'm registered at - which seems stupid? So my personal rating is not the deciding factor! But anyone could claim they lived at my house and run Up a bad credit rating?!

@Janedoe82

My take home is about £4.5k and then he pays £500 a month in CMS so total £5k

No credit card debt - the balance is paid off each month

No loans - well 1 payment left and that is in 3 weeks time on the only loan I have

No car loans

I'm so confused why they have said no.

Should I just not tell them I have children next time?

Speak to London and Country, they are free, whole of the market and recommended by MoneySavingExpert and have been for years. They will be able to advise you for your specific circumstances.

@EliflurtleAndTheInfiniteMadness

It may come to that - offering to pay him in instalments

I guess on the deadline his payment is due he could take me to court - but that would take time and money on his part and he'd look like a complete %^* for doing it given the only reason why I can't pay him is seemingly his inability to manage even a piggy bank

I wouldn’t. You do seem like you could manage it.
They might not take maintenance into consideration as it can be unreliable (not considered for benefits), but you would need to check.

Speak to a broker to discuss properly and get the full picture, but it could just be a combination of things.

Being the only person on the mortgage makes you automatically a higher risk to a mortgage provider than getting a joint mortgage because with only 1 income coming in if you lose your job then that’s it, bills stop being paid. There’s also the fact you have children, so that reduces your affordability quite dramatically (especially if you currently have childcare costs), again that has much more of an impact when there are 2 incomes vs one. It could just be a really simple affordability calculator says no job, you have a good income but when you factor in it will be the only income then it may be that when they factor in all bills, any car payments, childcare payments, the fact you have dependents etc plus being a sole earner household that it’s too risky for them to offer anymore.

Could it be that your ex has secured debt against the home and you haven’t been made aware? Unlikely as you would have had to also agree but it’s not beyond the realms of possibility and that would impact a remortgage to borrow extra.

@Mrsttcno1

He's Definitely not taken anything out in my name? I would have seen that on my Equifax report?

I agree about the risk with kids - part of the reason why I agreed the end of next year as that's when all kids are at school and no childcare costs

I think I'll just have to try again in 6-9 months - I won't have any childcare costs they will be able to see on my statements

Try London and Country

I got around an ERP by getting a cashback mortgage product which paid the ERP fee