Pre-Approved: Then Declined by Another Lender

Discussion in 'Loans & Mortgage Brokers' started by izzy16, 16th Jan, 2017.

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  1. izzy16

    izzy16 Well-Known Member

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    Hi guys, here's what's happened:
    • I was pre-approved by NAB for an IP loan
    • My mate (mobile lender at ANZ) said he could do better so we lodged with ANZ (my current bank)
    • Was knocked back due to an old business account being in negative from bank fees -$10 or so
    • Been told there will now be an enquiry on my credit file from ANZ
    • Just going to stick with NAB loan, BUT...
    • My NAB pre-approval runs out 28th March (they checked credit file before the ANZ thing which I passed, and they've said there's no need to revisit it unless my pre-approval runs out)
    • Worried that NAB will have to re-check credit file after 28th March, which will show the ANZ enquiry
    My questions for lenders/bankers - is this something to be worried about or am I being paranoid? Would this be reason for NAB to not extend my pre-approval if I can't settle on a property by 28th March?

    I've had excellent credit history since leaving school, paying off a 4 year car loan, paying a mortgage over 3 years with no defaults, I have no credit cards, not a cent in debt, over $210K in the bank, yet I was knocked back for -$10 in a business account! I'm worried this might hold me back, so any advice would be great.

    Thanks for your help.
     
  2. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    Just get your broker to make a note that the ANZ loan was not proceeded with. But I'd say highly unlikely ANZ declined you based on a $10 overdrawn account.

    I'd also revisit your NAB approval, especially if it was approved prior to December - it's possible that servicing has changed significantly and won't be honoured.
     
  3. izzy16

    izzy16 Well-Known Member

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    The ANZ lender told me it's because this happened a number of times. IT was a biz account I hadn't used in around 6 months that went negative $10 once a month as I was lazy in closing it. There is legitimately no other reason I can possibly think of why else, and that's what he told me.

    I was pre-approved 27th December with NAB.
     
  4. dabbler

    dabbler Well-Known Member

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    You did not use the ANZ, so it won't count, but don't try and hide that you did try and get a better deal by applying.

    I would make sure the broker knows even if you find a place before pre approval runs out as you never know when they may check.
     
  5. Corey Batt

    Corey Batt Well-Known Member

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    Agreed - I doubt that was the reason either. It's very common for us to get conditional approvals subject to the client bringing x account into line when they note it's current overdrawn etc.

    I would hazard a guess more likely that ANZ's extremely conservative borrowing capacity model didn't service your scenario and your mate didn't want to say he didn't get the numbers right!

    In terms of the pre-approval, if late December it would likely be under the current policy and the credit hit shouldn't be an issue.

    Jumping from NAB to ANZ and the like shows no real structured investment strategy - i'd be careful in this regard. If you're wanting to seriously grow your portfolio it would be prudent to ensure your lending is structured to help, not hinder, your ability to build a portfolio.

    Alternatively if the sole purpose is a cheap rate without worrying about building a portfolio, neither NAB or ANZ are top of the pack in that regard.
     
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  6. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Internal bank "defaults" can be damn harsh,while a good internal account conduct can boost things over normal credit score

    we have had CBA decline loans because peops were 5 bucks behind a month for 3 mths on their savings acct.............

    Not logical or sensible in the real scheme of things but their systems tell them 8/10 that will create a bad mortgage borrower.

    ta
    rolf
     
  7. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    The anz hit shouldn't cause too many dramas.

    If nab ask - tell them you enquired but didn't proceed.

    Cheers

    Jamie
     
  8. KayTea

    KayTea Well-Known Member

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    I had a pre-approval with NAB, then went to purchase before the 90-day period ran out, at which time NAB then refused to honour their own pre-approval. Nothing in my circumstances had changed at all, and the value of the property was well under the amount I was told I could borrow.

    The broker bent over backwards to try and work out what was going on - after talking to various managers etc, we still couldn't get to the bottom of finding out the actual reason for their change in stance, and I couldn't proceed with the purchase.

    Thank goodness I hadn't bought at auction :eek:
     
  9. Kelvin Mason

    Kelvin Mason New Member

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    Some lenders are more conservative. Had a business account recently where he was being over his limit most months and a few dishonours, despite having money elsewhere, the wont not consider at all.
     
  10. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Which isn't unreasonable based on current behaviour

    Ta
    Rolf
     
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  11. dabbler

    dabbler Well-Known Member

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    That is weird ?

    Did you have other loans with them ? or with other brands they have ?
    Were you behind on something with them ?
    Where was the property ? i.e could you still use it on another property ?
    Did you meet all the conditions on the pre approval ?

    I can only think the property was of a kind they were not considering as suitable, but they should indicate that. Should be some hint of reason.
     
  12. dabbler

    dabbler Well-Known Member

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    Do you think banks, if you had a bad patch and got behind on some accounts, minor accounts like this business account or some other, then you got up to date or never got into negative again for a perion, 6months, a year or more, would that change how they think ?

    How can the OP go about fixing any internal issue, assuming it is what he says, is there a method or way to make good ?

    I think even bankrupts can at some stage get a loan again ?
     
  13. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Bankrupts can even borrow while they are bankrupt - if they can find a lender.
     
  14. dabbler

    dabbler Well-Known Member

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    I know prior bankrupts that now live on waterfront in Sydney, can't be impossible. I never asked how/who they went with.
     
  15. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Probably owned by a related party
     
  16. dabbler

    dabbler Well-Known Member

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    Quite possibly.
     
  17. tobe

    tobe Well-Known Member

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    Credit reports revert to null after a time, so ex bankrupts, people who defaulted on loans etc get a clean slate 2-5 years later.
    Banks however have looong memories. I've had multiple declines over the years on similar grounds. Late credit card payments, a couple of missed car loan payments, multiple years earlier.
    It's pretty common, and when people say 'I want to stay with xyz bank, they know me, i shudder.

    Note, I deal with a lot of fhb, without a big deposit so this sort of thing really affects credit score.
     
  18. dabbler

    dabbler Well-Known Member

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    People who try and wriggle out of what they owe a lender or walk away, yeah, why would they lend again ever if you did not make good, common sense.

    Regarding the other was what I was really asking, which is more relevant to the OP, so they internally score this ? is there a way to fix it by acceptable conduct after ? seems we all would think bad things could happen to decent people.

    Say for the OP, if it was 5 years ago where he left an account drawn many times and thought it was no big deal, could he now open some other account or credit card & make sure it is conducted properly for a few years to overcome this, or is this a total unknown.

    I ask because you brokers must ask some of these questions or have these discussions sometimes. I also know someone who has had trouble paying a card off for 6 months.
     
  19. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    I had a client who we put to a particular lender. I asked him if he had any history with them and he said no.

    After application submitted the lender called me to state that the loan was declined because the client had taken out a personal loan about 10 years prior and had no repaid it. It was not on the credit file, but the lender still had a record of it - but it was unenforceable at this stage.
     
  20. dabbler

    dabbler Well-Known Member

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    Not paying something is going to have this result every time I would assume, with probably everyone except maybe mum and dad maybe.

    What if they told you yes, had some problems for 6 months years ago, but got back on track and continued then to make all payments and pay the loan back, if they wanted to go back to that lender, would you do that or not bother, or have a conversation with them first ?