Mortgage refused - to be reassessed in 3 months

HelennFlo

Hi all

im Just looking for some advice on our mortgage situation.
We got our AIP from AIB about 2 months ago, for 250,000 as the initial mortgage advisor said this is the maximum amount the bank would be willing to give us considering our savings pattern at that time. Our mortgage application has been there passed to another team and the new agent looking after our application told us we would qualify for 340,000 (4 times our salary) and immediately gave us a new AIP for 340,000. I asked him at that time if our savings are ok as previously been advised if we want more money we have to build our savings few more months) and he said yes, your savings are just fine. We found a house we really liked, we went sale agreed, paid the deposit, got the survey done to the house and now the bank says they will have to re assess our application in at least 3 months time as we don’t show repayment capacity. I actually was shocked by this because since the initial time we started the mortgage application our savings has improved, there was no dipping, we have no other loans, good credit history. I am just wondering why would they have said everything is fine then and now when things actually improved, they are pulling back?

XsApollo

AIP means jack all.

Did you go sale agreed , paid deposit and all that stuff on the basis of AIP.
did you have no other conversation with the bank about the house you were buying and if all was good before you paid the deposit and stuff?

HelennFlo

yeah, all was good. They requested for solicitor and property details in order to get the letter of offer.

Augme

I'd suggest trying a mortgage broker and see if they can provide any help. Do you need the full 340,000 mortgage or could you go lower?

HelennFlo

we were only taking 315,000 from the bank

XsApollo

AIP is just that “in principle”

You don’t need to have a house picked out to get mortgage approval.

You should get mortgage approval before you do anything like going sale agreed and paying a deposit.

as for why they pulled back after trying to get approval, my thinking is it would be when it gets to the underwriter or whoever is making the decision on lending you money they weren't happy with something.

Seems like they haven’t approved you for a mortgage of any amount? Or just on that amount?
go back to the bank and get mortgage approval on an amount they are willing to borrow you, and then look for a house.

Royale with Cheese

I presume by the deposit you mean the booking deposit and not the 10% deposit you pay when things get serious. The booking deposit is fully refundable, the bank are within their rights to turn you down as part of your formal loan application. I'm just about to close on a house and it's the 4th one I went sale agreed on within about a year. The first 3 feel through for various reasons, some from my side and one very much fron the vendor. I must have paid over €1500 for surveys and valuations for those 3 properties. Sunk cost unfortunately, you just have to write it off.

HelennFlo

you will get the official letter of offer only once you have found a property and the bank as well has made an evaluation on it