Frustrated by Mortgage conditions changing

[geri]

Hi,
My situation is a follows.
Myself plus OH currently own two properties. One is PPR, one is Investment property. Investment property has been fully occupied by the same tenants since it was rented out 6 years ago, and rent is paid in full every month.

We owe 185 on the investment property, its valued at 280
We owe 228 on the PPR, its valued at 350.
Both mortgages are with EBS with a tracker on the PPR of +0.9%.

Last summer we went sale agreed on another house valued at 495,000. We got full approval in writing for a 90% mortgage from EBS with no requirement to sell either of the other two houses. At the point where we were getting down to signing contracts, the vendor decided they didn't want to sell, and pulled out. Fast forward to January of this year, we went sale agreed on another house. It was on the market for 349, but we got it for 310 as we we not in a chain and already had loan approval. Contacted the EBS again and asked them to get the ball rolling. No problem, just send in up to date statements, income certs and all will be fine.
In the meantime, we had also decided to sell the Investment property. Got a call a few weeks ago from the EBS asking us to take the house off the market as they would not take the rental income into account for the new mortgage if the house was up for sale. We took the house off the market. This morning, got a call from the EBS stating that they will give us a max of 80% LTV load, on the condition that we first SELL the rental property. This does not make sense to me. Two weeks ago they told us to take it off the market, today they are saying we need to sell, six months ago we had approval for a much larger mortgage at 90% LTV, with no requirement to sell anything. I'm trying to set up a meeting with the manager of the local EBS tomorrow. I now fear will will also loose this house. Can anyone give me advise as to how to proceed in a meeting with the mannager tomorrow.

By the way, our combined salaries are 175 K per anum - no loans other than mortgages. One Instuitue of Technoloy lecturer, one private sector multinational employee.
Thanks,
Geri.

 

[robd]

Last summer is irrelevant as approval is only in principal and only lasts for max of 3 months if even.

No hard conditions for loan approval these days. Bank looks at each case from a risk perspective and adjudicate. Frustrating that it changed but that's the way it is. Most banks won't lend on multiple properties for some years.

From a risk perspective knock 50% off any current property valuation and you'll get approx what the bank is using and comparing to your mortgage owed in a worst case scenario. Essentially, you could end up in negative equity on both properties.

If you earn 175k on 2 salaries then you shouldn't need to take rental income into account. Max amount is 3 to 4 times gross income.

Try another bank and sell up investment property in the mean time.

It's along time since a Bank Manager has had the power to approve a mortgage. They're all approved/rejected by a central credit committee so meeting isn't of much benefit other than for getting information.