My plan is/was to sell my flat, pay off my outstanding debts and move home - effectively starting again as my mortgage would be 25 years again. I accepted an offer on my flat at the end of January and as I had been given a Decision in Principle from the Halifax, began to look for properties to move to. I found one and contacted my (independent) mortgage advisor to confirm the mortgage offer, only to be told that 'the criteria has changed and they are no longer willing to lend me the amount stated in the Decision in Principle letter', despite the DiP being valid until 16 March 2012 and nothing having changed in my circumstances. According to my mortgage advisor, some changes in the financial sector have 'sent all lenders into a panic, and none of them are willing to lend'.
When the DiP was agreed, it was done so on a 90% LTV (the LTV is not detailed on the letter, only the maximum amount). The mortgage advisor now says that Halifax now want a 15% deposit instead of the 10% agreed previously (so now it's 85% LTV). With the deposit I have, after paying off my debts, this would effectively mean looking at a property with a purchase price at 70% of what had originally been agreed - not possible, unless I buy practically the same sized property in the same area I am in now, and there is little point in that. I will be speaking to another advisor to see if they are able to locate an appropriate deal for me, alternatively I will have to wait until I have sold my property and paid off my debts before applying again - even then if the lenders are not exceeding 85% LTV I am stuffed!
How is it that they can provide a Decision in Principle in which they state "Provided you meet the conditions of this Decision in Principle, we will be able to make you a full mortgage offer if you make a full mortgage application before 16 March 2012.", and then they can just rescind on it just like that?! It's not worth the paper it's written on! My circumstances have not changed, I was completely honest about my debts which I will be paying off on selling my property, and my salary and employment details have not changed.
I am about to write them a letter expressing my disappointment and amazement that they can and have done this. Can anyone suggest a way forward for me please.
Many thanks in advance.