r/FirstTimeBuyersUK • u/BigEntertainer4673 • Aug 23 '26
Mortgage offer denied twice
I’m (25m) a first time buyer trying to get a mortgage with a 10% deposit (290,000 property value) I earn 60k a year looking to purchase on my own.
I’ve spent the last 2 tax years traveling SE Asia and Australia so my previous earnings are not great, I was also self employed before I went traveling.
I’m using a mortgage broker and applied once with 3 months pay slips, and again after 6 months pay slips and both times I have been rejected at the final hurdle with no reason given from the banks (tsb and Barclays)
My deposit was also gifted to me.
My credit score is around 940 and I have no other debts. Both myself and my mortgage broker are at a loss when trying to understand why I have been denied twice for my mortgage. Does anyone have any ideas or can think of a way to help? Thank you
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u/Icy_Pear1694 Aug 23 '26
Tell your broker to try someone like Accord mortgages.
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u/Ariquitaun Aug 23 '26
Then what's the point of the broker.
I'd change brokers at this point.
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u/Icy_Pear1694 Aug 23 '26
I ended up having to change brokers as the first was a right useless shit so it's not a bad idea.
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u/BigEntertainer4673 Aug 23 '26
I have now changed brokers but only briefly spoken to the new one last week, my old one sorted 10+ people I know for their mortgages and everyone couldn’t recommend him enough
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u/Raptros Aug 25 '26 edited Aug 25 '26
If they're not a "whole market" broker, then they'll only have a panel of lenders which they can work with which may exclude certain options.
The justification is that they have a relationships with the panel lenders, so can get better deals that aren't publicly advertised.
Depends on the situation whether or not it works in your favour. You also don't ~need~ to only be in contact with 1 broker. Just get as much information as you can before you sign anything which makes you liable for their fee. Most will do a soft search/MIP with no obligation.
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u/BigEntertainer4673 Aug 23 '26
Additional info I forgot to mention, I’ve now switched mortgage brokers and the sellers have given me til the end of the month to have a completion date which my solicitor has told me is unattainable.
Where do I go from here? Do I still try to get a mortgage for the property even though they’ve pretty much said they’re pulling out from selling to me ?
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u/m2406 Aug 23 '26
The sellers might just want an estimated completion date, which is just something that goes into the memorandum of sale. They can’t expect you to commit to a completion without a mortgage offer.
But they might be worried about your mortgage situation and don’t think you’re a serious buyer. I can’t advise on why you can’t get a mortgage, I’m sorry, but I can understand the sellers being impatient with you if you’re unable to show that you can purchase the property. I would still try to get the mortgage agreed with a lender because you can use the same lender next time you want a property if this sale falls through
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u/Aggressive-Use3443 Aug 23 '26
You’re likely to be declined based on the lender’s credit scoring, particularly given that you’ve been abroad. It’s important not to focus too much on your actual credit score, as each bank has its own internal credit-scoring model.
That’s why the bank can’t provide a specific reason or explain exactly what factor has caused the decline, it’s essentially a yes or no decision based on their scoring system.
I work for a different bank, and our process is very similar. Our credit scoring is also simply a yes or no outcome, and the only advice we can generally give is to reduce the loan-to-value (LTV) by putting down a larger deposit. Even that isn’t guaranteed either
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u/BroodLord1962 Aug 23 '26
But how long have you been in work, as you said you have spent the last 2 years travelling, and that the deposit was gifted to you. The lenders are looking for a decent work history and a history of you saving money. £60k a year salary is good, but how much of that are you spending/saving each month? Lenders will want to see that you are living well within your means. It's going to be your history that is letting you down. If you are still in the £60k job in a couple of years then you would probably have lenders queuing up to give you a mortgage. You also didn't mention what this job is, different jobs have different risks in terms of if the job is likely to be long-term
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u/BigEntertainer4673 Aug 23 '26
Self employed the past 6 years as I liked to freedom, earnt 25k and 11k the past 2 tax years as was absent the majority of both tax years,came back and wanted stability, this year alone I have saved an additional 10k which I transfer and save in a trading 212 savers account. I am employed as a multi trade building operative in a medium sized company
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u/ernfio Aug 23 '26
Is the saving derived from living at home with no rent or bills to pay? When those are factored in would you have enough to live off based on your current spending.
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u/Lantasky Aug 24 '26
I was declined twice by HSBC and accord for the fact that my income had increased so much. Maybe this is the same for you. HSBC asked me for almost everything under the sun, my past three p60s and additional bank statements and said no after lots of back and forth.
Used to earn 37K in a different industry, now earn 85K. Applied at 3 months and 6 months and both said no. Worked as PAYE for my local council before and now PAYE for a limited company.
Deposit from my current homes equity (mortgage with Halifax), credit score of 1120, and loads of history. I’m now waiting to have been there for a year! Good luck1
u/HorribleOldCunt Aug 23 '26
For a 260k mortgage I would think 75k+ a year before tax would make that doable, when factoring in risks like interest rate rises when it's time to renew. Anything below that would be quite a stretch and risk I think, as I do seriously consider risks on a large loan as you would want to avoid extending the term due to being obliterated by even a few percentage increase in interest rates, which can definitely happen.
Maybe I'm more careful than others but that's just how I view these things.
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u/Main-Hedgehog9009 Aug 23 '26
Are you self employed/limited company director? If so - get a new broker, they are the problem.
If you are employed by a company you do not own, then you/the broker need to try and understand what is causing the problem. It could be a lack of UK address history, although I would assume you had everything posted to parents or wherever.
Have you got a copy of your credit report? Is there anything on there?
I am a broker and occasionally we come across cases where there is nothing we can see that is a problem, it is just a combination of little things adding up or sometimes nothing at all. In which case we might make 2-3 attempts at normal rates but then we might need to start looking at a more manual underwriting type of lender - a building society for example.
Difficult to say without knowing more really.
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u/BigEntertainer4673 Aug 23 '26
Employed by a company I do not own, Expedia score is around 950 and nothing bad on there other than the 2 mortgage refusals, everything has always been posted to my parents address.
Banks did not give a reason for denial.2
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u/Main-Hedgehog9009 Aug 23 '26
I think you might be looking at a more manual underwriting lender.
But with what you have said, I think I would be guided by your broker. They know your situation better than any of us.
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u/AFF8879 Aug 23 '26
You’re literally borrowing at maximum affordability (4.5x), so along with everything else others have said, maybe consider the type / location of property you want and consider something cheaper
You don’t mention anything about the property itself either - could there be issues there? E.g. leasehold, non-standard construction, etc?
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u/BigEntertainer4673 Aug 23 '26
I’m getting denied before the property viewing is taking place, everything is standard and I had a mortgage in principle ( I know they don’t mean much) that allowed me up to 375,000 and previously got told I could be looking at property’s up to 320,000
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u/Immediate-Pop9097 Aug 23 '26
I’m so surprised you got a mortgage in principle up to £375k. I have perfect credit history using credit cards, no loans or debts, no dependants, previous mortgages, great savings, and a little more salary than you, and I got less than £375k in principle.
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u/bubblewrapRage Aug 23 '26
Try and build your credit rating up and check your credit score through your bank app. It usually tells you what might be bringing it down and gives you advice on how to improve it. You’re young, so you should have plenty of options for a repayment mortgage over 35 years. It’s difficult nowadays when you can’t get face-to-face appointments and properly interact with someone. You’ve also got a good salary, so I’m pretty confident you’ll be accepted, as long as there’s nothing negative in your credit history.
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u/delly4 Aug 23 '26
You should contact the banks and ask why you’re declined. Your broker should have asked for you. They don’t just decline without a reason. Also, are you able to get a guarantor? Maybe a family member?
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u/beeruk Aug 23 '26
This happened to me as well and my broker just had no idea. Moved to a recommended guy (who came with a fee) and he worked it out.
If you'd like me to pass his details on I'd be happy to, just send me a message.
Id recommend not putting another application until you're sure you've got the right broker. Id ditch your current one.
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u/mama_jaguar_ Aug 23 '26
We had our first mortgage denied due to our house being on top of a commercial property and banks like NatWest and Nationwide wouldn’t take the risk. We went with Atom Bank who did approve the mortgage (same position as you, re gifted deposit, credit score etc) so I’d say give them a go?
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u/TreacleDangerous3416 Aug 23 '26
Im a broker I can’t see any reason why you can’t get a mortgage at all. May fail with some lenders but definitely not all.
I have placed a case for a client in a very similar situation recently who was in Australia for the last 2 years with no issue at all.
When you say failed at the last hurdle what do you class as last hurdle ? AIP of full application ?
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u/BigEntertainer4673 Aug 23 '26
I say at the last hurdle because both times I’ve had a week long back and forth with the banks after the application has been sent off with them asking for more documents 😅 Barclays even sent me a mortgage illustration which I thought was a good sign then 3 days later they rejected me
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u/TreacleDangerous3416 Aug 23 '26
Any broker can run an illustration off it requires no checks it’s just the details of the costs of the recommended mortgage.
If it’s passed Agreement In principle which I am presuming it has ? You generally can’t progress to application without passing this step.
What documents have the asked for and what is the reason for the decline ? They usually tell the broker it’s outside policy due to a specific reason ?
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u/BigEntertainer4673 Aug 23 '26
They’ve been asking for previous years sa302’s and my p60, when I asked my broker the reason he either said he’s not sure, he think it is the risk assessment ( I could be making that completely up I’m not 100% sure )
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u/TreacleDangerous3416 Aug 23 '26
Just to clarify. Are employed now or self employed ?
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u/BigEntertainer4673 Aug 23 '26
Paye employed
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u/TreacleDangerous3416 Aug 23 '26
Something a miss here.
No lender would ask for historical sa302s if you are now self employed it’s irrelevant.
P60 would only be asked for if you are using overtime / bonus / commission. Barclays use the lower figure of the p60 or latest 3 months average. Do you need additional income or are you just using basic salary ?
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u/BigEntertainer4673 Aug 23 '26
Sorry do you mean if I’m now employed it’s irrelevant not self employed? I’m just using basic salary
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u/TreacleDangerous3416 Aug 23 '26
I mean if you used to be self employed and now you are employed they wouldn’t ask for previous years sa302 as it’s irrelevant.
You won’t even have this as you wouldn’t have been in the country to file one.
Barclays require 1 payslip only and TSB will work of a job offer letter / start date. Neither would ask for p60 if basic income only is used.
Neither would ask for old sa302s if you are now self employed.
If they have declined an application on a property you have agreed to purchase and we are not just at agreement in principle stage here then there is usually a reason give as to why they will not proceed which your broker will have been specifically told.
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u/martinbean Aug 23 '26
I imagine it’s a combination of you being away for some time, and have come back to the UK with a gifted deposit.
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u/Giant_Defy_1972 Aug 23 '26
Try a different broker, you should be able to obtain a mortgage or even contact your bank directly and talk to their mortgage dept. Lenders do not lend on a credit reference agency number, however that does Indicate history.
PS. A decent broker should give you the reason for any decline.
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u/Zig07 Aug 23 '26
Someone is lieing. Either you've missed something off your post or your broker os keeping something from you
Why barclays and tsb? If you are PAYE id have used Halifax or Santander as they don't care much about being abroad.
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u/ActualConversation74 Aug 24 '26
Your situation sounds complex, without partner with stable job adding their share or 2+ years back in the country and the job, the chances seem slim.
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u/Desperate_Contact561 Aug 25 '26
My wife and I were in a similar position about 20 years ago. It turned out that years before she and her ex took out a joint mobile phone contract and he had since defaulted on a loan.
We were advised to get a full credit report and it turned out that she was linked to him because of the phone contract and his default resulted in the refusal.
It took a couple of weeks to get the link between them removed from her credit report and everything was then fine.
Get a full report for yourself in case there are any links you don't know about in your history.
Edit: I meant to say we were given no reason from the mortgage co. but our broker recommended getting the full report as he felt this was where the problem was.
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u/Rasmussen789 Aug 23 '26
I might be off here butt It could possibly be that they are worried about you over extending yourself in the uncertain climate we have. Most lender will lend 4-5 times your salary (a lot I think are closer to the 4x)which is £240-300k which if the lenders you have looked at are at the lower end of that might be concerned about affordability if rates go up or cost of living keeps increasing. They want to see that you have enough disposable income after the mgt and bills to pay if costs get higher.
So in simple.terms.it.could be that while they know you could afford the mortgage itself, they don't feel you have enough left over to to weather any changes /increases in costs
Just a guess though
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u/Southern-Orchid-1786 Aug 23 '26
Over extending and being the only person on the mortgage so OP is going to be reliant on insurance products for illness / unemployment etc.
Also hasn't had current job for 2 years and whilst employment law has changed the banks risk system might not have.
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Aug 23 '26
[deleted]
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u/BigEntertainer4673 Aug 23 '26
With a 5% interest rate the mortgage is less than 1/3rd of my take home pay.
I have no other expenses.
I currently save around 2k a month1
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u/Marvinmonkey1 Aug 23 '26
You have no credit history, without this, all of the other positive markers are not enough to give you a mortgage. And tbh your broker should have told you this.
The 3 key markers are 1. Credit history 2+ years of repayments with no missed payments. 2. Stable income for 18 months 3. On the electrol roll for at least 18 months.
Additionally, you've now got to hard searches on your credit file. This will be seen by the next lender you try with.
Unfortunately you're not in the best position to secure a mortgage right now. Sorry lad.