In this brief guide, we will discuss the reasons why a mortgage could be declined by an underwriter at Santander.
There are many reasons why a Santander mortgage underwriter may decline your mortgage. We discuss them below
Mortgage declined by an underwriter at Santander?
There are many reasons why a mortgage could be declined by a mortgage underwriter at Santander.
Your Santander mortgage application may be declined by an underwriter due to fraud, failing Santander’s mortgage affordability checks, due to a poor credit score or due to the mismatch of information on your Santander mortgage application and your supporting documents.
If you are worried about having your mortgage declined by an underwriter at Santander then you may want to apply with the help of a mortgage broker.
Mortgage brokers usually have a good idea on what type of requirements most mortgage lenders have and hence will be able to put your mortgage application in front of a mortgage lender who will be willing to lend to you.
When referring to mortgage brokers here we are referring to independent mortgage brokers and not mortgage advisers within a mortgage lending brand such as Santander.
Mortgage brokers also tend to have established relationships with some of the mortgage underwriters at lenders such as Santander and this can mean than during manual underwriting there may be more flexibility in order to get your mortgage application approved.
Why your mortgage was declined by a mortgage underwriter at Santander?
Below are some of the main reasons why you could be declined by a mortgage underwriter at Santander.
Proof of income
If the Santander mortgage underwriter has declined you due to proof of income then you could try and reduce your monthly expenses by using budgeting apps. You could also try and increase your monthly disposable income by getting spare jobs.
You could also use a government scheme which may be able to increase your mortgage deposit or reduce the cost of the property purchase.
Some of those Government schemes include:
- Lifetime ISA– gives you a government bonus of £1,000 if you save a maximum £4,000 a year.
- Help to buy ISA– gives a maximum bonus us £3,000 if you save the maximum allowed of £12,000. Before you get either you should consider which is better. Lifetime ISA vs Help to buy ISA.
- Help to buy equity loan– gives you up to 40% as a 5-year interest-free equity loan. You begin to pay interest at 1.75 % after the fifth year and 1% plus RPI for every year thereafter.
- Shared ownership– You can buy between 25% to 75% of the property initially with a shared ownership mortgage and then buy more using a staircasing mortgage.
- Armed forces help to buy– similar to the help to buy equity loan but specific for the armed forces personnel giving them an increased chance of acceptance.
- Rent to buy– This is the right to buy scheme on which this guide is currently discussing. A different marketing name is just used. Watch out for this when shopping to avoid missing out on eligible properties due to confusion.
- Right to buy– allows you to buy your home at a discount price.
- Preserved right to buy– same as above.
- Right to acquire– similar to the above.
Depending on where you live, you may also be able to take advantage of home buying schemes provided by your local council. Example: In Norwich, the local councils provide the Norwich home options scheme.
You may also be declined for a mortgage by a Santander underwriter due to proof of income if you are self-employed and the mortgage lender does not feel that your income will be stable enough to maintain your monthly mortgage repayments.
In this case, you should try and use an experienced self-employed mortgage broker who can place your mortgage case with a self-employed mortgage lender who is more willing to lend to you, if Santander isn’t.
Self-employed mortgage brokers have experience of the lenders and their general lending criteria.
They may also know how to position your mortgage application in order to ensure you get a mortgage offer.
Different mortgage lenders have a way of looking and assessing your income for a mortgage.
Some may accept various income sources such as income from benefits whilst others won’t. Although all mortgage lenders will work with mortgage multiples, more care has to be taken when you have an unusual income to ensure you are able to get a mortgage offer.
A bad credit score
If your mortgage was declined by a Santander underwriter due to adverse credit or a poor credit score then the first thing you may ideally want to do is check to find out what the adverse credit issue was.
If you are unsure of what your credit score is then you should check your credit score from the four credit bureaus in the UK: Experian, Crediva, Equifax and Transunion.
Some of these credit bureaus may charge you a fee to view your credit report so what you can alternatively do is request a statutory credit report which is a free credit report which each credit bureau must provide to you upon you requesting it.
Alternatively, you can also use credit score services such as Checkmyfile and clearscore to check your credit report.
If you find that you have serious adverse credit issues then you should speak with a bad credit mortgage broker who may be able to help you by positioning your case in a way a bad credit mortgage lender will provide you with a mortgage offer.
You should also follow some good credit tips to ensure your credit score begins to grow if you plan on abandoning your current mortgage application and trying again in a few months.
Some of the good credit tips you could follow are:
Avoid closing credit accounts
Avoid getting rejected for credit
Avoid payday loans
Keep your credit accounts open for as long as possible
Open a credit account to show good credit behaviour
Get on the electoral roll
Avoid going beyond 30% credit utilization
Get a credit builder loan
A mismatch of information
Mismatch of information is, unfortunately, one of the reasons many mortgage applications could be declined by a Santander underwriter. If the details on your identification documents, banking statements etc do not match with what you have stated in the mortgage application then your mortgage application could be declined by the Santander mortgage underwriter.
This could be errors such as your address not matching, your income not matching etc
If they are simply errors then usually the underwriter will contact you or your mortgage broker to get some clarity.
However, if there are various errors then the Santander underwriter will likely decline your mortgage.
If you are not confident that you could avoid making any misrepresentations or making errors on your mortgage application then you may want to use a mortgage broker who will fill in the Santander mortgage application for you, check it for accuracy and then submit it to the Santander mortgage underwriter.
Most mortgage brokers will already have established relationships with the mortgage underwriters at particular mortgage lenders, this means they can easily resolve common errors like a mismatch of information on a mortgage application form.
A fraud marker from CIFAS or any other fraud database could also make your mortgage application be declined by the Santander underwriter. You should perform a subject access request with CIFAS to ensure you don’t have a fraud marker on your name before you make a mortgage application and get declined by the underwriter.
Mortgage lenders all have a type of property that they will not lend to and it may just be that you have a property such as a non-standard construction property that a mortgage lender such as Santander will not lend on. In this case, your mortgage will be declined by the Santander underwriter.
You can avoid this by using a mortgage broker who has some experience of Santander’s lending criteria and is able to advise you.
If you are buying a non-standard construction property or a grade two listed property then you may want to seek the help of a mortgage broker to avoid having your mortgage declined by a Santander underwriter as these properties may require niche mortgage lenders.
Below are some of the most frequently asked questions about mortgages being declined by underwriters.
Can a mortgage be denied during underwriting?
Yes, a mortgage can be denied during underwriting and this is usually when mortgages are declined.
This is because the job of the mortgage underwriter is to review the mortgage application and either approve it or decline it on its merits.
Getting a mortgage in principle does not mean your mortgage can still not be declined by an underwriter.
How long does it take for the underwriter to make a decision?
When considering mortgages it can take from 48 hours to 3 weeks for an underwriter to make a decision on a mortgage.
What happens if my mortgage application is rejected?
If a mortgage application is rejected then you may see a drop in your credit score for a few months but this will usually come back up if you do not continue getting rejected for credit or doing any other bad credit behaviour.
If you make multiple credit applications in a short time then your credit score could fall as this will be viewed as you being desperate for credit. Multiple credit rejections will also cause your credit score to fall.
In this brief guide, we discussed the reasons why a mortgage could be declined by an underwriter at Santander.
If you have any questions or comments please let us know.
If you need financial advice and you live in the UK then you could contact the Money Advice service over the phone or via chat for impartial advice.
You can also contact the debt charity “Step Change” if you are in debt and need help.