Picture this – newly wedded couple, buying their first home. We had discussed getting a pre-approval and they were coming back to complete the application however they found a home in the interim and were keen to buy it.
So we submitted a loan application which was in mortgage insurance territory as they had a 5% deposit.
They loved the place and were keen to get it all sorted before they took off for their honeymoon in Japan in December.
We discussed their budget and expenses. They had a credit card and a small personal loan for a car. We also had their savings accounts to show bank their genuine savings.
The property was valued and loan submitted for processing. All as good – until the mortgage insurer requested confirmation from an account where the rent was being paid from that the clients had not provided to us originally.
And buried within this statement was a $70 per fortnight repayment to a finance company for the engagement ring – which he had been paying off for the past 18 months.
It really was an honest mistake, he is a genuine guy. However – mortgage insurers take non-disclosure of debts very seriously – especially on a 95% loan. Loan was declined despite our best efforts and State manager involvement.
It is always sad when a loan is submitted to a lender and everything is going well – and this happens.
Lucky it does not happen often – but it is so important to let us know everything you have BEFORE we submit to a lender.
And getting it pre-approved before you start looking is always a better idea.