What to do when your bank will no longer lend to you

Here’s an interesting post that may resonate with reader’s who have found themselves in a similar position…

mortgage refused by existing lenderClient’s Situation
Our clients were First Time Buyers who both had Halifax Help to Buy Isa’s, a joint Halifax savings account and bank accounts with Halifax & Lloyds Bank all of which totalled around £22,000.

They were married with a nine year old son, Mr was age 48 employed earning £19,000 per year and Mrs was age 39 employed and earning £14,000 per year.

They had no current financial commitments.

They had found a property and agreed a price of £113,000 and quite naturally made an appointment to go and see their main banker, Halifax.

After spending two hours with the Halifax Mortgage Adviser and being credit scored their application was declined.

Clients then contacted Manchester Mortgages who straight away requested that clients obtain a copy of their credit file.

The Problem
Reviewing the credit files soon explained why Halifax had declined them – there were numerous missed payments on mobile phone bills and historic outstanding debts totalling over £5,000 to Nat West Bank.

Main Street lenders such as Halifax, Nat West, Nationwide, Santander, normally do not lend to people with a poor credit history.

The Solution
After researching the market we found a lender willing to accept client’s credit history and we obtained a Decision in Principle to lend the full mortgage amount required which meant our client could purchase the property.

Clients were unsure how much deposit they wished to use so we fully discussed in detail their personal requirements and monthly budget for mortgage payments and provided them with various options.

Our clients chose an 85% loan to value mortgage which meant the deposit required was £16,950 which left them funds for solicitors costs and future home improvements – the mortgage was taken on a two year fixed rate over 21 years
(which was the maximum term available due to Mr being age 48).

The lender required confirmation of where the deposit was coming from which we were able to do by producing the various bank statements from Halifax & Lloyds Bank.

The chosen lender only accepted solicitors from their named panel and as the clients chosen solicitor was not on this panel Manchester Mortgages were able to recommend a local solicitor on the panel to our clients who quoted £150 cheaper than our client’s chosen solicitor had quoted.

Conclusion
Our clients are now the proud owners of a 3 bed semi-detached house in Farnworth, Bolton.

how much money can you save?Manchester Mortgages have diarised to contact clients before their two year fixed rate mortgage expires to review their requirements and as long as clients have maintained a good credit history over this time we are confident we will be able to obtain them a more competitive interest rate at that time.

Summary
If you are in any doubt regarding your credit history we recommend that you obtain your credit file from companies such as –

Experian
Equifax
Noddle
Clearscore

And let Manchester Mortgages take care of the rest – a poor credit history may mean lenders like , Halifax, Nat West, Nationwide, Santander, will not lend to you but we will find a lender that will.

Whatever your circumstances please contact us on 01671 706 0242 to discuss your requirements.