Nationwide Mortgage offer and appeal Help !!!!!

[mumma24]

Messaging on behalf of my daughter.

Back in May my daughter got a mortgage offer from Nationwide, all was accepted and agreed and house purchase ticking along for past 4 months and hoping to exchange soon.
Threy decided to contact nationwide again to see if they can get a better mortgage rate as rates coming down. The mortgage advisor has basically told them that they have changed how much they are willing to lend based on affordability and are now saying they can’t borrow as much. So potentially can lose the house and may have to pull out. Nationwide advisor is appealing the decision for them. Can they do this to them? Offer them a mortgage (it wasn’t a mortgage in principal) and then change their decision just before exchange? Hopefully hear back from them today or next few days but so upsetting for them

Has there been a change in your daughter's circumstances since the mortgage offer, such as a decrease in income? If so then they can absolutely withdraw the offer.

Mortgage offers are usually only valid for a certain length of time so has this maybe lapsed and new lending criteria brought in which has now changed their affordability?

Has there been a change in financial circumstances at all?.

They didn't change their decision though, if your daughter had not requested a new rate, then the offer would have been valid until it expired.

However, your daughter has requested a new rate, and to do this, the application is re-scored.

It could be a change in your daughter's financials, increase in credit card, usage of an over draft, pay day loan etc. Or it could be a change in Nationwide credit score card, and they are more stringent on your daughter's loan to value, age, loan amount etc.

So, sadly yes they can do this. An offer is not legally binding and can be pulled at any time, it is an offer to lend money, and not a binding contract, a common misconeption.

@HansBanans @Ilikewinter there has been no change in circumstances since the mortgage offer. The offer is valid until November.

The offer was withdrawn when your daughter contacted then for a new rate. The application would have been scored and adjusted accordingly.

So they offer she did have, is no longer valid.

this isn't a case of them having moved the goalposts. They haven't just told her that they're no longer prepared to lend her the moy, she's essentially re-submitted the application to tryto get a better deal, and no longer meets the criteria for the amount which was previously agreed. They absolutely can do this, and as PP said, it's not a binding agreement.

@fromdownwest oh they didn’t explain this to them 😞 they just called to see if they can have a better rate with them.

She would have been dealing with the call centre, and they really should have advised prior to the change of rate, that they would be rescoring the application.

Maybe worth trying to challenge the fact, that they should have made her aware of the risks.

She could try a local mortgage broker, who would have been a better option from the start. They may be able to secure the full amount, at a new rate.

If affordability is the issue have they tried extending the term (they can always overpay to the terms they wanted so long as under 10% or whatever terms they have) we had that problem with nationwide, they decided they didn't want to lend what we wanted over 25 years so did 35 instead and we overpaid.

I had this year's ago with Santander. I had a mortgage offer in principle offer. This was to port my mortgage to a new property. When I went ahead with this they declined my mortgage (no change in circumstances). I put a compliant in but they wouldn't change the decision. I therefore had to go elsewhere for a mortgage.

After complaining to the ombudsman they did refund my early repayment charge that I incurred due to moving to another lender. But wouldn't honor the mortgage offer.

I work for a lender ( although not nationwide).

Unfortunately, this can happen.

Residential mortgage offers are legally binding once offered unless new information comes to light which can affect the decision.

If a new credit search is triggered where the applicants had taken out new credit or had a larger amount owing on their credit card/overdraft it could affect how much they could borrow, I’m afraid.

we used to see this regularly with first time buyers who would get their offer & then order some buy now pay later furniture for example. Heartbreaking.

When we bought our house I told my husband not to buy anything, put anything on his credit card or use his overdraft.

did nationwide give them any explanation?