I made an offer on a house 2 weeks ago, I had a mortgage in principle for up to £85K with no issues and I have a £200K deposit in the bank from the sale of my previous home (a 1 bed flat).
I am in my early 50s and work part-time & also receive a small PIP award for a long-term disability. House is 275K. My salary is £25K.
Now the broker who did my mortgage in principle and is seeking a £75K mortgage says that the bank might not give me the full amount because my pip award is renewed every 3 year.
I am extremely pissed off by this as I based all my calculations on the mortgage in principle and expected that my salary itself would be enough to borrow that amount (3 times my salary) rather than having to faff about with PIP awards. The broker never mentioned that this could be an issue.
I am having second thoughts about the whole thing now as a result and wonder if I should just withdrew from this purchase and look for cheaper home to buy (easier said than done as I am on the South East coast) or just accept that I might need to move into a 2 bed flat rather than a house.
I am concerned that if the brokers starts looking for a new deal somewhere else I will end up with hard searches on my credit score and still no mortgage...and I don't want to start paying solicitors fees for something doomed to fail.
What would you do in my situation? Am I overstretching myself anyway?
I really wanted a small house after having so many issues with noise in my previous flat...