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Original poster

Buyer mortgage rejected... please give me hope!

20 replies

JoyofSpring · 01/02/2016 19:48

I found out today that our buyer's mortgage application has been rejected. Not sure why but it seems to be him rather than the property - as far as I know. Apparently he is going to appeal and may try another lender. I assume either process will take time and then he could be rejected again!

We have had an offer accepted on a house and one o the reasons they took our offer was because we had a buyer in place - a buyer in rented accommodation! The vendors of our new house are moving into a new build and want to complete quickly.

So it all feels a bit like we are going to be back to square one. We might lose our buyer and will almost certainly lose the house we want if that happens - and we might lose it anyway if we have to wait for another lengthy mortgage application process. Its extra gutting because house prices in the area we are looking at seem to be skyrocketing.

Does anyone know how likely an appeal is to be successful? Or if you are denied a loan by one lender are you likely to be accepted by another?

Feeling miserable (have already eaten all the chocolate in the house as a result).

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Bearbehind · 01/02/2016 19:55

In your situation I'd put your house back on the market tomorrow.

If the current buyer has been rejected for a mortgage there's not much chance of appealing.

Depending on the circumstances, it may or may not be possible to get one elsewhere but as it stands this buyer is proceedable.

At least if you remarket you are keeping your options as open as possible.

Bearbehind · 01/02/2016 19:56

Is not proceedable.

wowfudge · 01/02/2016 19:57

Remarket while he's trying again so you have a back up plan? If it's the kind of property that will appeal to a FTB you could have someone else quite quickly. Will also give him the impetus to move quickly.

SunnySomer · 01/02/2016 19:59

We were in exactly your situation last summer. We put the house back on the market until the buyer did have proper finances in place.
It turned out she was able to sell another property and finance the purchase that way, but if she hadn't we wouldn't have wanted to hang around (or mess our vendor around).

Normandy144 · 01/02/2016 20:05

We were in a similar situation recently except we were the buyers. I think it's important to understand whether your buyers were rejected or whether the lender couldn't lend them enough as that's a big difference. Original application for us was done with HSBC. We had a decision in principal with them and after going through the application process they offered us £40k less than the DIP. We couldn't work with that (they helpfully suggested we should just increase our deposit by £40k.....oh right so that's what I need to do!) We told the agent and he put us in touch with a broker who found us another mortgage with another lender and it all went through fine. He said he deals with HSBC let downs all the time so it was nothing surprising to him.

We at exchanging tomorrow. So all in all, from offer accepted, including the second mortgage application it has taken us 3 months to get to exchange. That included the downtime over Christmas.

I guess you need to find out from the agent handling your purchase whether the people you a buying from can cope with maybe an additional month or not. It maybe that they already have people queuing up to buy their property, but it might be wise to stick with your current buyer, especially if it is just the case like us that their mortgage application wasn't rejected but that the lender wouldn't lend them enough,

Original poster

JoyofSpring · 01/02/2016 20:05

Thank you!

We are going to remarket starting tomorrow anyway (which I am dreading as getting it tidy for viewings with small children was incredibly hard / stressful).

Just so annoyed because I don't see a new buyer swooping in, chain free, to save the day next week! So I can't see a way that we will keep the house we are trying to buy.

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Original poster

JoyofSpring · 01/02/2016 20:07

Normandy I got the impression it had been rejected completely.

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mrschatty · 01/02/2016 20:09

Oh no. Good idea to go back on the market...

Slightly simmilar to your buyer we were agreed a mortgage in principle then they decided the house was worth 10k less than they were willing to give us for the house... Took absolutely ages to get sorted... nightmare all round.

MissyMaker · 01/02/2016 20:09

I had a mortgage turned down last year, and I had a credit score of 999 and a huge amount of equity. Within 24 hours I had another mortgage secured. Lenders have their own criteria so potentially the buyer can find another lender quickly. I agree with others though that you should put your house back on the market asap.

Normandy144 · 01/02/2016 20:09

Ah ok, then I guess that's a different kettle of fish then! Wouldn't hurt to remarket then and see how it goes. Who knows it might still work out with the original buyer but at least you can feel like you are at least doing something about it in the meantime.

Normandy144 · 01/02/2016 20:16

Might also be worth getting your agent to put the buyer in touch with a broker who can really assess the situation on behalf of the buyer. If he's just independently approaching lenders,especially if he has an usual situation then he could waste more time with more failed applications. At least if the agent gets him to work with the broker they use (let's face it, all agents have brokers they prefer) then you will get some feedback on the status of the application. The broker will be able to assess the situation and advise whether or not it is salvageable.

Bearbehind · 01/02/2016 20:19

I really wouldn't recommend the EA broker. This person has already had one mortgage declined so it's important that he gets independant whole of market advice and that's not very likely to come from an EA broker.

Original poster

JoyofSpring · 01/02/2016 20:20

That's encouraging Missy!!
mrschatty & Normandy I will speak to the agent again in the morning and see if I can find out a bit more about the situation... I don't think it was HSBC but maybe they had weird criteria. I know he had a mortgage agreed in principal before.

I really hope there wasn't a problem with the survey or any of the info we gave them because that could affect any future buyer. Ugh. Can't start worrying about that!!

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Original poster

JoyofSpring · 01/02/2016 20:21

I believe he is using an independent financial advisor - but the EA mentioned he'd spoken to him so I guess it could be their "preferred" broker. Will find out tomorrow

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Bearbehind · 01/02/2016 20:21

I'm pretty sure you'd know if it was an issue with the survey as they'd likely be trying to negotiate on it.

Normandy144 · 01/02/2016 20:25

The broker recommended by our EA was a whole of market broker. They were an independent company to the EA. The mortgage they sourced for us was better than London & Country and Which? Could both come up with. So not all EA recommended brokers are bad news.

Original poster

JoyofSpring · 01/02/2016 20:31

Keeping everything crossed that he can either get them to reconsider or get a new lender to approve him... but I guess I should get a few more potential buyers through the doors because the whole process to even apply for a mortgage can take a while. It was 4 weeks since the mortgage survey before we got his rejection!

In the meantime, I'm not sure if we should continue with our own application. I'm guessing we should stop until we have a buyer who is proceedable?!

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FlappyRose · 01/02/2016 21:06

I had a mortgage turned down last year too. First time buyers in rented accommodation. We had no problems securing the agreement in principle with Halifax, we did the application and they instructed the valuer. Then they changed their minds. I still don't know why.
Anyway, we got in touch with a broker, secured a mortgage almost immediately with Santander and got a better rate.

MidnightDexy · 01/02/2016 21:51

I had terrible trouble getting a mortgage first time around because of a 70 quid 'debt' that Carphone Warehouse had logged as a default 6.5 years previously. (The whole thing was a farce and i even had a letter from carphone warehouse dated to the relevant period that confirmed my account was closed and no sums were due...) Loads of lenders rejected me completely even though i had an otherwise unblemished credit history and a 20% deposit and a very good and well paid job... Be patient with your buyer and don't write him off, he'll be gutted, but absolutely do get it back on the market asap. Cover your own back as well.

Original poster

JoyofSpring · 02/02/2016 12:07

We are officially back on the market! Doesn't look like the buyer can sort this out quickly so maybe we can get someone else.

Have some viewings booked for tomorrow so I had better get tidying...

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