Pepper Money - First time buyer

D

Dai060588

Registered User
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3
Hi there,

Apologies if I have this in the wrong place. This is my first time to post here and I was just looking for some advice / opinions.

My Wife and I are first time buyers. We had looked into mortgages with AIB and EBS (never actually applied in full with either) and then we heard of pepper money.

We contacted them and got "Approval in principal" on an amount.

We were told to go house hunting and if we found a house to put a deposit down on it.

Luckily enough after a few viewings we found a beautiful house. And with the advice from Pepper put down a deposit. We contacted Pepper back then and initiated the process of going for full approval with the underwriters.

From what I can see its a very lengthily process. From the time you get all your paper work in it can take up to 6 weeks for the full approval from their end.

Here are my concerns.

I got a call last week from the auctioneer (about a week after we put down deposit) he told me that the owner of the home was inclined to get the ball rolling. From day 1 we were honest and open about the timelines with the auctioneer so I am worried now the owner may pull out if the process takes too long.

I am also concerned about the likely hood of us being approved by the underwriters. Does the approval in principal have any bearing on whether or not we will be approved ?

Thanks for reading and any advice you may have

D
 
It's a little bit complicated, as Pepper Money has just been sold to Finance Ireland last week. They haven't made any public announcement on what this means for people in your situation, other than they will be in touch.

You should contact them, and see what stage your application is at, and how long it will take, or if you need to apply elsewhere. If it's any consolation, I sold a house this year, and the buyers changed mortgage provider after contracts had been issued. There was a slight delay, but if you're in a strong position and not looking for any exemptions, another bank might be able to turn an application around quickly for you.

As an aside, at this stage, the auctioneer shouldn't really be contacting you. Once the sellers solicitor has your solicitors details, most communication from here is between the solicitors.
 
Thanks very much Red onion.

My wife and I are in full-time employment and we have no issues with credit. Any time we have had a loan we have never missed a payment either.
I didnt know that about the solicitor if I am honest! so thank you very much for that piece of advice.

we are at the start of the process where their "packaging team" gather all relevant documents. This can take up to 10 business days. We are 5 business days into this process so we hope to hear before the end of the week or at latest start of next week. Once they are happy then its sent to under writers to seek full approval which can take a further 5 business days. Obviously the underwriter doesn't have to approve it so we could still be declined at that stage
 
Why would you go with the most expensive rate in the market on the biggest purchase you're likely to ever make?
 
Leo said:
If you have copies of all your documents, it might be advisable to apply to some of the other providers and get yourself a better deal while you're at it. Take a look at the Best Buys table here.
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Agree 100%, don't put all your eggs in one basket, if Pepper turn you down and you only start applying elsewhere at that stage there'll be a big delay and you risk losing the house. Also, why go with Pepper at all, their rates are terrible.
 
Dai060588 said:
My Wife and I are first time buyers. We had looked into mortgages with AIB and EBS (never actually applied in full with either) and then we heard of pepper money.

We contacted them and got "Approval in principal" on an amount.
Click to expand...

Could you explain that as I am completely mystified and I am genuinely trying to understand the process by which people choose a mortgage.

Unless you have a poor credit record, there is no reason for going to Pepper.

Check out

Best Buy for up to 90% LTV

and

How to go about choosing a mortgage
 
Pepper will give you AIP without you submitting paperwork or an underwriter looking at a file. They plug the figures into their system and it spits out the AIP. You then go looking for houses and start the paperwork once you've had your offer accepted. They then take ages to assess your case and everyone gets nervous because of the delay. It's an awful system. People's financial history is rarely straight forward and there is always questions to be clarified along the way. It is much better to submit all your paperwork at the outset, knowing that an underwriter has assessed your case first.
 
Brendan Burgess said:
Could you explain that as I am completely mystified and I am genuinely trying to understand the process by which people choose a mortgage.

Unless you have a poor credit record, there is no reason for going to Pepper.

Check out

Best Buy for up to 90% LTV

and

How to go about choosing a mortgage
Click to expand...

Thanks Brendan.

I wouldn't be any good really with the terminology but more or less as explained by SBarrett its a figure Pepper calculate which give you an idea of property prices you can go looking for.

Id like to clarify something also for a few people there is a plain simple reason we went to pepper. Although their rates are high they were the only ones offering enough money to purchase a house and I am not talking 100's of thousands I am just talking about something that will buy you more than a derelict shed.

KBC offered me and my wife 70K of a mortgage because we have a car on finance. I am not sure what kind of house 2 first time buyers are supposed to buy for 70k

AIB were willing to give us 170K but because we have a car on finance they wanted to take 60K off that (even though the car is worth 19K - go figure)
 
Dai060588 said:
AIB were willing to give us 170K but because we have a car on finance they wanted to take 60K off that (even though the car is worth 19K - go figure)
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They do this based on the high probability that once this car is paid off, you will go on to finance another, and so you fail on affordability criteria.

Be careful that you fall into the trap of borrowing more than you can afford to repay. With their rates among the highest available, any broader rise in interest rates will see them move even higher. It would be better pay off the finance on the car, and reapply to the cheaper providers after building up 6 months of clean financial history.
 
Dai060588 said:
Although their rates are high they were the only ones offering enough money to purchase a house
Click to expand...

Ah, I see. I thought you went to Pepper and on one else. But you checked with AIB and KBC so that is fine.

They are a near-prime lender and will charge you accordingly.

Brendan
 
Dai060588 said:
KBC offered me and my wife 70K of a mortgage because we have a car on finance. I am not sure what kind of house 2 first time buyers are supposed to buy for 70k
Click to expand...

It's not really the price of the house which dictates what they will give you. It's what they think you can afford.

Don't get too excited about Pepper. When you give them all the information, they may well scale back the loan to €70k.

Brendan
 
I wouldn't be surprised too if they either scale back or make it a condition of the loan offer that the car loan is paid off, while Pepper are more lenient on slightly tarnished records I would have thought they were still sticking pretty close to the guidelines re affordability so that the amount offered should be much the same as others.
 
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