Our Mortgage Has Finally Been Approved
Boy is it a long process getting a mortgage these days! First you call up and get an agreement in principle, even if you already did this online they still want to do another one. Once you have that they agree to give you an appointment with a mortgage advisor. That appointment takes 2 hours and they grill you about every regular expense you have. They ask what all your direct debits are for and if you could cancel them if you had to in order to afford your mortgage. Pointing out that our mortgage will be nearly £150 a month cheaper than our rent and therefore if I can afford to live currently then clearly I can afford to live once I start saving £150 every month did not help.
They ask you what insurance you have in place. In my case they were not impressed when I did not know the value of the death in service payment my partner would get from the NHS should I die whilst in service, but they were impressed that I had it (and they knew I would have it, I didn't this is now on the list of things to find out more about). Add that to the five thousand pounds my union would pay if I die before I retire and that seemed to satisfy them that should I die there would be enough in the pot to at least cover some of the outstanding on the mortgage, although of course they recommend that I take out life insurance which they happily quoted me for before we went any further.
They then ask about your salary, this is where its complicated in my case. Because I work days, nights, weekends and public holidays I am paid a different amount for each of these. The way the NHS does this is actually a bit strange - instead of getting a different hourly rate or a set bonus type payment what they do is pay you a certain number of extra hours, so instead of getting double time on a sunday I would get paid my usual 11 point something hours as my regular hours plus 9 point something as sunday hours. Similar thing for Saturdays, nights and public holidays. The bank were a little confused but thankfully my advisor was used to dealing with NHS staff and pointed out that we could make the whole process quicker by simply using my basic salary as I would pass affordability even without my extra hours since we are going for such a small mortgage.
That was the affordability bit done finally, they then credit check you and you think that's the end of the process but what they say is 'congratulations you have passed the credit check which means your application moves to the next stage' the next stage is underwriting. In the past an application going to underwriting was not a great thing, it meant your application was borderline and a computer couldn't make the decision but now everyone has to go through this. My hard worked for credit rating could not save me from the hell that is underwriting.
Underwriting then look at all this information in even grater detail and in my case since I am mortgaging through my own bank they look at your bank account in great detail, this was the part that scared me the most. I am an avid overdraft user, since my overdraft is still free on my graduate account. They also look at your payslips to ensure you haven't lied to them and this whole process takes around a week.
Eventually I get a call to say that I have passed the checks! Now that seems like the end of the matter but no of course its not. Now they have to copy the valuation over onto their letterhead which sounds like something that would take me five minutes but apparently it takes them four to five working days (this part of the process is Scotland exclusive, if you live elsewhere in the UK this is where your lender would instruct your valuation survey on the property).
Today I called them because today was the last day I was told a decision would be made. I was told a decision had been made on Friday but a technical error had meant my file hadn't updated and I was put on hold till this was fixed. WITHOUT being told what the decision was I might add! She comes back on the phone and tells me they are happy to make a formal offer of loan! The email arrived almost instantly too so its all there in black and white now, I can actually buy my first home!