Well we have our completion certificate, and we have self -financed with a little family help up until now.

A few months back we knew we were in a funding hole and so we went to see our bank and one other 

and were assured (loose definition) that as we were only intending on borrowing LESS than 10% of the 

house value a LOVELY low interest mortgage wouldn't be an issue ....nice.

 

but of course they wanted the completion to be done ...fair enough

 

So we decided to batter our credit cards ....we are normally very good ...and so me and the wife had good balances and thought

hey...its short term...we will consolidate with the £30k loan and still have enough left over to do the driveway and a lot of fence erection

..happy days!

 

but that sadly ..is where the optimism was misplaced.

 

Once we sauntered in with our completion certificate and told them we had an "agreement in principle" it was all ...underwriters, risk,

only been in the dwelling for a few weeks ...(which they KNEW as they wanted the completion certificate) and BOOM! ...no mortgage

 

Don't worry ...they said ...we can easily get you a personal loan ....you know secured on the house, money in your bank in 72 hours,

same as mortgage ...pay back over 7 years ....same as the mortgage we wanted ....but at 16% APR !!!!

 

No thanks ...so we tried our other bank ....looked good ...no problem ....filled in forms ...come back for another appointment to sort it all out 

last week ....bring ID and stuff ...we thought FANTASTIC

 

but guess what .....they couldn't get the rate we wanted , but can get us proposed for a PERSONAL LOAN 17.5%

 

Now call me cynical ....but we both have good credit ...no other large outgoings ...except these bloody credit cards ...which we are paying off.

..and the mortgage (we can't get) would essentially cut this outgoing by 40% ..so where is this bloody risk???

 

and if its too risky to let us pay back £500 a month over 7 years ....why is it FINE for us to pay back £800 over 7 years on a personal loan?

 

all that TALK and MEETINGS and PHONE CALLS and PROMISES to pull the offer at the last minute and try to browbeat you into a high interest loan.

 

Same tactics too ....your "mortgage advisor" is suddenly switched with a new person ..."loan specialist" and you cant get hold of the original person

(very convenient) and of course you can't speak to the underwriters ...God No ...when i asked it was like i had stood up and taken a P**S in the Assistant managers

teacup..oh yes they do give you a brew when you are waiting .

 

If we hadn't been given all that smarm and verbal massaging 3 months ago we would NOT have battered high interest credit cards..or paid some trades extra

to complete in a hurry

 

but hey ...my partner has only been with Nat West for 30 years and me with Santander / Abbey for 35 years ...so we are obviously untrustworthy, high risk individuals.

 

The only reason I can HONESTLY see is that they will not make enough money off us with a mortgage over 7 years and so want to go for a nice butty with a personal loan

over the same period

 

If they were up front and told us that at the outset, instead of all the smiles and congratulations and form-filling i would have saved hours of my life and just left tried another way

...although might have p**sed in the tea ...not sure.

 

has anyone else encountered the bait and switch ?

 

Edited September 7, 20197 yr by Ed_MK

Santander did it to me.  Not only promised a small mortgage, to be paid back over a maximum of five years, but took my money for the arrangement fee, valuation etc, wrote to me telling me that the mortgage had been approved, and then, on the day I went in to draw down on it told me that that "their policy had changed" and all they could now offer was a personal loan, at three times the interest rate. 

 

I still haven't got the arrangement fee etc back from them, and have moved all my banking, savings etc elsewhere, as I have no intention of ever dealing with them again.

 

 

Yes this happened to us, we had put a lot of stuff on credit cards because we were in the process of selling a plot and knew we could pay it off when it concluded. The plot sale was taking much longer than expected and monthly outgoings were high with the cc payments so we decided to ask for a £25k mortgage from our bank whom we had been with for years and had had a small mortgage with for our previous build(at that time they would lend on an unfinished house)

Phone call made explaining position, appointment arranged, we get there to be told ;

1. We don’t lend without a completion certificate 

2. Even after you get that you’ll need to in the property for 6 months minimum 

but hey we can give you a personal loan, when she quoted us for the loan the repayment wasn’t a lot less than we were paying to the credit cards so we left empty handed!

LLoyds pulled this trick on us with one of our buy to lets. We already had a mortgage, they agreed (but nothing in writing) to extend the mortgage to fund new windows and doors. "The paperwork only takes a few days, come back when you are ready"  When the doors were scheduled to be fitted we went back and they blew a raspberry at us, but of course would offer a personal loan instead.

 

Because the amount was small, we solved that with a 0% credit card (thanks RBS)

 

I no longer have any dealings with Lloyds and would not touch them if they were the last bank standing. They lost a loyal customer who had been with them for over 30 years with a good credit rating for being so damned stupid.  And I am happy to repeat this warning to others whenever the topic arises.

Can you try two smaller loans from different lenders?

 

 

If you're paying interest on card balances—and have a half-reasonable credit rating—run (do not walk) to https://www.moneysavingexpert.com/credit-cards/balance-transfer-credit-cards/

Edited September 7, 20197 yr by richi
add credit-rating qualifier

8 minutes ago, richi said:

If you're paying interest on card balances—and have a half-reasonable credit rating—run (do not walk) to https://www.moneysavingexpert.com/credit-cards/balance-transfer-credit-cards/

Yes Virgin are still doing 29 months 0%, I have one.

Would it help to take a 25 year mortgage with a 'no redemption penalty' so that you can overpay? 

Thanks for advice..

 

it seems i am not alone.

 

At present I am in talks with Sainsburys Bank .....we will see what comes of it.

 

re: advice on consolidation to 0% cards ....My wife (who has most of the plastic) is already a serial

switcher ....and although it was never a lot (before) i fear she has moved herself into a corner LOL

...having switched more times than the fridge light in Gemma Collins house

 

Borrowing from 2 or more lenders ....is a thought....Although I am wary of going on a credit MISSION.

As i know that the searches will show up and essentially kibosh your chances ....still not sure why ,

but i believe they do.

 

(sigh)

 

its about this time the blame game starts ...me and the other half are already bickering over what if's and 

if only's ...stuff we could have done cheaper (but not as well) ...

 

oak stairs could have been pine.....range cooker should have been standard....kitchen worktops

could have been a laminate or composite....bifolds could have been just normal french doors , why did we opt for UFH

etc etc

 

shame .. i bet it often goes this way

 

one thing we havent spent much on is the front garden !

 

It sounds like you are going direct to lenders, have you sounded out a broker as to best possible options?

hmmm..it could be worth a try ...I never considered it (doh)

i presumed they would be more expensive ....fees and all .

 

but we may have little option

 

I think where we went wrong was the amount we put onto our cards in the last 2-3 month

it looks like we are now in debt up to our necks ...which to be fair when you add them up

it is close  ....we both have good experian and other credit scores ....except they now both have the caveat

"using too much of our card credit" ..so its dropped a little our scores

 

can you believe it ...last year it said we didnt have ENOUGH use of credit cards 

 

What a world !

 

Any recommendations of a decent broker is appreciated all

 

PS. We have ZERO mortgage, and we are borrowing 7% of the value of the property (recent valuation)!

something doesnt seem right ...I mean last time i took out a mortgage was 20 years ago ...I could SWEAR

it wasnt this hard

On 07/09/2019 at 12:13, Jilly said:

Would it help to take a 25 year mortgage with a 'no redemption penalty' so that you can overpay? 

 

Well we worked out that we could afford (with relative ease) to borrow over 7 years

at an interest rate under 5%

 

I am not a young buck ...54 ...whilst the wife is a fair bit younger 45 ....but i presume that they would not lend

beyond pension age ...I may be wrong ...

 

We looked at early repayment ones ...some had weird caveats like no more than 10% per annum and 
staged redemption penalties up to 75% of the term ...etc etc. To be honest I was cock a hoop when i paid off my mortgage

2 years ago ....and i know it psychological ...but the thought of putting another long term yoke over my shoulders is kind or
...you know, a step backward 

 

but ...if it has to be 

16 minutes ago, Ed_MK said:

I am not a young buck ...54 ...whilst the wife is a fair bit younger 45 ....but i presume that they would not lend

beyond pension age ...I may be wrong ...

 

My BIL took out a mortgage mid 50's having taken a nice early retirement deal at age 50.  So his only income now is a defined benefit pension.

 

The bank just looked at it as an income, which unlike a job, he can't get sacked from and loose that income. 

1 hour ago, Ed_MK said:

Well we worked out that we could afford (with relative ease) to borrow over 7 years

at an interest rate under 5%

 

I am not a young buck ...54 ...whilst the wife is a fair bit younger 45 ....but i presume that they would not lend

beyond pension age ...I may be wrong ...

 

Mortgages go up to at least 80; not sure about personal loans - would expect 65.

On the Personal Loan, remember that you have a legal right to repay it early and not pay the remaining interest - which may help with a strategy. You may also be able to make early part-repayments (you will need to check that law).

Can you get a guarantor on a PL to reduce their risk? I have never tried it.

 

F

Further thought.

 

Now that you have completion and occupancy, can you expedite your VAT reclaim? Would that help?

F

Edited September 12, 20197 yr by Ferdinand

I have just taken out an unsecured personal loan for £25k at 3% over 7 years with Nationwide to get me to completion stage.

I will then be able to pay back about half of it with the VAT reclaim.

Experian recommended AA Loans as the best lender for me with a 95% chance of acceptance, same terms as Nationwide.

I applied for it & was declined.

I too have a 999 credit rating & ample income, however, they said I did not fit the criteria but wouldn't say why.

I was mortified.

Made an appointment with Nationwide the next week. It was in my bank within an hour.

Some of the loan amount was used to pay off credit card balances coming to the end of the interest free period.

I just had to sign to say that the credit cards would be paid off within 48 hours of receiving the loan.

Other advantage of unsecured personal loan is no charges.

I looked into a mortgage & it was going to cost about £2000 in fees just to borrow £30k.

Repayments were also quite high even though the interest rate was low because of short repayment period., I'm 57.

Edited September 12, 20197 yr by Moira Niedzwiecka
Further info

On 07/09/2019 at 09:29, ProDave said:

I no longer have any dealings with Lloyds and would not touch them if they were the last bank standing. They lost a loyal customer who had been with them for over 30 years with a good credit rating for being so damned stupid.  And I am happy to repeat this warning to others whenever the topic arises.

It seems to be a theme across the industry (including insurances) since the customers nowadays are much more likely to shop around, to milk the loyal, long term customers as much as possible and try to subsidise some great offers with it to lure new customers in. Had that experience with various banks and its a known theme with car/house insurance anyways