Provisional Mortgage Approval Means Nothing.

Boardieman

A frustrated first time buyer here. Long story short, I got mortgage approved through a broker a few months back, after spending weeks wasting my time applying directly to AIB who I have been banking with for 20 years. The customer service in AIB was appalling so I took the broker route and low and behold got a higher amount approved within a matter of days.

Two months later and 1 month before my approval period was set to run out I went sale agreed on a lovely house and hoped that everything would now be smooth sailing.

When going back to the broker with the information on the house they had nothing much to say at first, but after chasing them up for 2 weeks they told me I needed to send in more information about this and that and in short the bank weren't playing ball.

4 weeks have now gone by and last week literally one week before my approval period was set to run out I was told the bank were now offering me less money! I was told by a couple of colleagues they can do that, but are they having a laugh? I'm not sure who to get angry with here, the bank or the broker. The house I have gone sale agreed on hasn't even been viewed by the bank and all this is happening. The broker has now told me that another bank want to offer me more money so I am now back to square one again and need to re-submit everything.

Its almost like the broker lies through their teeth or something to get a payment from you for approval but when it comes to actually signing the dotted line they don't really give a rats ass. Saying that, maybe they are doing their job properly and the banks are just a bunch of cowboys.

Anybody else experienced this?

peteb2

Not really telling much specifics to judge your story on. Are you someone who thought that because the bank you could have 200k, you thought you would still get this despite the price of the house only being €175k? Not saying you are, just asking!

Boardieman

yes

camel jockey

"I got mortgage approved"...

You didn't, you got approval in principal.

Boardieman

yes

camel jockey

Boardieman wrote: »

You are nit-picking.

I'm not, you just didn't understand what it meant. There was no contract or guarantee that they would lend you the amount.

killers1

Boardieman wrote: »

A frustrated first time buyer here. Long story short, I got mortgage approved through a broker a few months back, after spending weeks wasting my time applying directly to AIB who I have been banking with for 20 years. The customer service in AIB was appalling so I took the broker route and low and behold got a higher amount approved within a matter of days.

Two months later and 1 month before my approval period was set to run out I went sale agreed on a lovely house and hoped that everything would now be smooth sailing.

When going back to the broker with the information on the house they had nothing much to say at first, but after chasing them up for 2 weeks they told me I needed to send in more information about this and that and in short the bank weren't playing ball.

4 weeks have now gone by and last week literally one week before my approval period was set to run out I was told the bank were now offering me less money! I was told by a couple of colleagues they can do that, but are they having a laugh? I'm not sure who to get angry with here, the bank or the broker. The house I have gone sale agreed on hasn't even been viewed by the bank and all this is happening. The broker has now told me that another bank want to offer me more money so I am now back to square one again and need to re-submit everything.

Its almost like the broker lies through their teeth or something to get a payment from you for approval but when it comes to actually signing the dotted line they don't really give a rats ass. Saying that, maybe they are doing their job properly and the banks are just a bunch of cowboys.

Anybody else experienced this?

What were the conditions on your initial AIP? Was there any further underwriting ones or was it simply property details, rate, term & solicitor? Aib used to offer a 3 month AIP but changed that last year to 6 months although they reserve the right to look for up to date income confirmation and bank statements once you're 3 months into your AIP. What did they ask for when you went back with a property in mind? The other thing that happened with Aib in June is they increased the rate at which they stress test applications so this could have been a factor too. Usually though AIB would honour any AIP that was still valid providing no change in circumstances/repayment capacity etc. I'm presuming your broker has suggested Ptsb now to apply to for a higher loan amount? They've brought out a new calculator & credit policy but are painfully slow to get a decision from at the moment...

Boardieman

yes

killers1

Boardieman wrote: »

AIB are out of the picture. Once I went to a broker I got provisionally approved with another bank for a greater amount. I was asked to provide property details at this time which struck me as odd as I am new to this and like most buyers hadn't even looked at a house yet. I signed some paperwork which outlined the 3 month AIP for amount XXX. When I went back to the broker with a Sale Agreed House they were pretty useless for a week or two because my dealings got passed down to a junior broker in the company. I had initially been dealing with the owner. The junior broker mixed up some information and without getting into details made some huge **** ups at first. Once these were sorted I was lead to believe for a week or two that the bank were sorting things out from their end. When contacting the broker for an update I was then told the banks rates had changed and that a new bank now wanted to lend to me. I was then asked to re-apply so things went back to square one again. Like I said in my initial post, the broker has not asked for details on the house and my circumstances had not changed nor did the initial bank receive any more information prior to reducing their rate. They just reduced it because they can. In my opinion too many people in this country get paid to push paper around and not provide the kind of customer service and clarity required when dealing with something as fundamentally important as the purchase of a house.

Ok, so reading between the lines your broker got you an AIP from ICS who issue an approval in principle based on info supplied by the broker and without actually seeing any of the supporting documentation. (Ics/boi insist on property details to be included in the application) When you went sale agreed and the docs were sent in they didn't stack up on either income or proven repayment capacity so the bank reduced the amount they were willing to lend. Broker then went to Ptsb to try to get you the amount you need...

Sounds like the service you received was pretty poor alright and the fact that you've had to pay for the privilege too is even worse...

Boardieman

yes

killers1

Boardieman wrote: »

May I ask, do you work in the industry? Is there a specific trend there with brokers and banks that led you to pick out those two banks?

I do indeed work in the industry. I can't speak for you brokers actions,but it certainly wouldn't have been my approach to an application. I'd never rely on an ICS/Boi AIP simply because of the way the bank underwrite the applications. Their AIP is completely worthless tbh whereas other banks will actually underwrite the application having seen all docs up front and therefore stand over the amount offered on their AIP.

How did I do with my 'educated' guess of what happened?

Boardieman

yes

killers1

Boardieman wrote: »

Pretty well. I'm not too sure who the new bank are but I might check it out to see if it is PTSB. The original bank was BOI. Why do you think the broker would of gone with PTSB in particular?

Ptsb just came back into the market in June with competitive rates and an aggressive credit policy. Their calculator tends to be more generous than Aib or Boi and their variable rates are now cheaper too. It'll be either Ptsb or Kbc.. Surprised you don't know though...

Boardieman

yes

killers1

Boardieman wrote: »

Do you know what, the broker probably told me but I was so frustrated at hearing the original bank had dropped their rate I didn't catch the name of the new bank. Would you suggest I take any steps at this stage or should I just leave it alone and wait to see the outcome? Thank you for the othe bits of advice by the way. It cleared up a lot of confusion my wife a I have be having with regards to the application.

No probs. If your worried about the outcome feel free to pm me some details and I'll be able to give you an accurate idea of the likely decision.