The message of this story? I don’t take no for an answer. Mortgage lenders need to be pressed. What one broker couldn’t do, Lauren and I could. Where most brokers give up we do not, we love the challenge and the satisfaction of getting the job done.
Santander are a great lender for self-employed individuals, however their processes and the people you speak to sometimes make things very difficult. Plus everything takes 24 hours, we send something over today but we don’t hear back until tomorrow.
Richard and Donna were moving home, had agreed a purchase, and their mortgage application had been submitted to Santander with another broker. They came to me as their previous broker could only secure £226,000 from Santander, and I knew after reviewing their information I could get them much more closer to £260,000 as previously promised for the home of their dreams.
Fast forward a few months, and they are now in their new home after a gruelling process to get there. We knew it was possible to get them more and something didn’t feel right with the previous application…
“We appreciate your hard work and tenacity in attaining us a mortgage that made our house purchase doable, when the banks made it tough for us.”
We will go the extra mile for our clients and sort out problems, especially when they come from another broker who has underperformed. It wasn’t an easy journey but I persevered through until I could give the couple the great news.
TIP: One of the issues with Santander is that even if you are paying off your debts, they are still included because they have no control over, or guarantee on, their repayment.
After checking affordability calculations and speaking to the lenders, Santander was still looking like the best option for them.
I knew I could get them to the £260,000 they needed.
Having already had £226,000 offered from Santander most brokers wouldn’t try again, but my clients needed it to complete their dream purchase. They are truly the only option due to using the latest years income figures rather than averaging the latest 2 or 3 years. I was adamant a fresh pair of underwriter eyes (and the fact that they are so guided by their affordability calculations) could make it work.
I charge a broker fee on application because I have done my due diligence and I am confident it will go through, I haven’t lost a mortgage case yet and if I did due to my own error I would always refund my fee.
In this instance I agreed to take my broker fee once the offer had been produced because they had already been turned down by Santander, so I was taking a big risk for 1 months work. I hate saying no and I want to succeed where others have failed, and without saying I want to help clients because I know what it means to them.
Richard was happy to go ahead with my services, he said:
“the last (seemingly incompetent) broker took one month to give us a casual negative answer. We are now at the stage, with the house move on the verge of collapse, where we need an answer within 48 hours really. Maybe 72 at the most.”
I submitted the agreement in principle and it was approved, with a few requirements. needed:
Now, there had been a justified decrease in turnover between the latest and previous years, so I asked the account to add an explanation. This showed that the decrease was due to a justified investment in the business i.e. higher expenses.
TIP: Decreasing turnover, profit and income is not good in a mortgage lenders eyes.
We supplied the above and Santander came back with a max loan of £241,500 which is £19,330 less than we requested – ARGH!!!
The net income used from Santander’s affordability gave us £3588, however when we called Santander the underwriters had used a net income of £3363. Immediately Lauren wants to know why, and it’s her mission to find out.
We found out from her employer that Donna is on a week 1, month 1 indicator – this means that she has another employment where she is earning all of her tax free income or the tax man has got this wrong. It turns out that on Donna’s payslip her tax code shows as 1000L, when it should be 1080L, so the underwriters have used a lower net income than we would have been aware of, this was a learning curve for us and shows just how much detail underwriters go into.
We advised Donna to speak to HMRC. They admitted it was a mistake and she’s on the wrong tax code: they changed her tax code in July 2015 by mistake, due to some confusion over her second casual job at the university. Her tax could should be 1080L. This is because she claims for laundering of her uniform and professional subscriptions.
Lauren checked again and Santander affordability stacks up with the right tax code.
This is where it pays to have a broker that has good relationships with lenders, we can get strings pulled via our business development managers who are targeted on application and completion, plus they have managers who can assist them further.
In order to get it overturned Santander need an up-to-date payslip showing the right tax code there is no issue lending £260,830.
They got a correct payslip with tax code 1080L and we sent it over.
Santander then went on to advise that the max loan still stands at £241,500 due to undisclosed credit they have found on Experian.
I got the www.noddle.co.uk credit reports to see exactly what Santander were looking at.
Having double checked the reports we spoke to Santander again and they could now consider a maximum loan of £244,000.
But I was still getting the maximum lend of £256,882 when I made my own calculations.
Lauren called Santander back spending 40 minutes on the phone, they then advised us that the student loan on Donna’s payslip had been duplicated hence the affordability being lower… this was Santander’s error.
Finally, we got the maximum loan of £256,500.
I advised Richard and Donna, and they accepted it. We had taken 4 weeks, which is 2 weeks over our average, and the sellers were getting twitchy, the clients accepted the £3500 reduction as it was close enough and affordable.
Finally, we passed it back to the underwriters to produce an offer.
When the offer arrived, without asking for it, my broker fee was in my bank. We average about 4 hours on the phone to lenders over 2 weeks but I think we easily exceed 10 hours on this case, as at times we could be on hold for 30 minutes just to speak to someone.
The most important thing to me is getting the mortgage I said I could, I don’t want to fail myself or my client. This was by far the most frustrating application for Lauren and I but we got an end result the client was happy with.
The job certainly isn’t easy acting as the middle man (broker), especially when we’re not getting the correct information. We have the persistence, determination and confidence to keep powering through.
“A big thank you to Gary and Lauren at Active Brokers for doing the impossible with a mortgage”
There is nothing more satisfying than achieving a goal. Arranging a mortgage is like lots of short term goals one after the other, and there is no bigger commitment than helping someone buy their house.
Another win for Active Brokers and our client. You could be next.
Have a chat with me on Facebook, LinkedIn or email firstname.lastname@example.org. Don’t hesitate to call in on 0800 028 4268 or arrange a call with me via our live messaging service, from 09:00 to 18:00 Monday to Thursday and 09:00 to 17:00 on Fridays.