Deferred start refused - what next?

We have been approved for a mortgage with AIB.

Used a broker and asked about the initial 3 month moratorium (or deferred start) as advertised on AIB's website:

It says:
First Time Buyers can avail of a range of benefits including:
A choice of competitive interest rates available. View our Mortgage Interest Rate Options section for more details.
A range of flexible repayment options* such as Interest Only OR 3 months Deferred Start.
Repayment terms up to 35 years.
20% introductory discount for First Time Buyers with Home Insurance from AIB.
Consultation with an AIB Financial Adviser to assess your Life Assurance options.
Low cost finance Masterplan Account to help you manage your monthly bills. View our Related Information Section for further details. An account maintenance fee of EUR4.50 per quarter applies.

* The above repayment options may impact on the amount and/or term of the mortgage and are subject to lenders approval. Deferred Start is where you make no repayments whatsoever for the first 3 months and the interest is simply added to your loan. Deferred Start is not available with the Interest Only Option.

We are not first time buyers but not in a chain and have been renting. also great credit ratings and savings etc - tho that probably means nothing these days.

Initially were asked for our reasons for deferred start and told it is approved on a 'case by case' basis. Told them I am studying for final exams in 2 months (documentation can be provided) and also have a baby, and as house needs painted entirely, would prefer to do so before we move in with baby, and also exams will be finished by then. Broker told me today we were refused - no reason given. I've asked to appeal this or meet someone in person to appeal. I am not happy about paying rent and a mortgage for 2-3 months, and also do not want to mess around the people we are purchasing from by delaying things, although the house was an investment property and rented and they don't live in it.

What are our rights here? I am so angry I feel like pulling from the whole thing.

thanks,

Alli

Re: Moratorium refused - what next?

The whole point of being in this situation is that you have enough saved to cover rent and mortgage. It is not a good sign to the bank that you want to defer payments from the get go. What if some unexpected expense comes up for you in 6 months or a year or even 5 years down the line? what contingency have you put in place for that.
If you are not a first time buyer as you state then you are not entitled to the deferral. I think the reason this deferral is given to first time buyers is to allow for all the purchases that go with buying a first house.

Re: Moratorium refused - what next?

Alli said:

... First Time Buyers can avail of a range of benefits including: ...
We are not first time buyers
What are our rights here? ...

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It sounds like you don't qualify for the special offer from the bank, therefore I'm not sure what "rights" are being infringed upon, or what right of appeal might be open to you.

Alli said:

... I am so angry I feel like pulling from the whole thing. ...

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It sounds as if that decision is effectively taken out of your control.

Re: Moratorium refused - what next?

Alli said:

What are our rights here? I am so angry I feel like pulling from the whole thing.

thanks,

Alli

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You have a right to accept the mortgage being offered if you are happy with the deal. You have a right to decline the offer if you are not happy with the deal.

I cannot understand why you would feel angry or with whom you are angry.

Angry as I spoke to bank directly before going with Broker and was assured that it's a normality to get this deferred payment.

My initial worry that by asking for it would impact on getting the mortgage. Was assured by asking would have no adverse affects on the mortgage application as our savings proved we had money enough to rent and pay mortgage.

Was also assured we were 'just like first time buyers', so I guess from the outset it was all but a given in my mind that we would get it. Can afford to sit and pay rent plus a mortgage, but it annoys me that there is no reason given other than 'case refused'. Plus, it's a waste of money to us to do this!

I want to know on what basis we were refused and yeah, if it means not taking the mortgage then we will just have to reconsider. Is it wrong to want to know why we were refused? Getting the impression from posters replies that I should not be annoyed at the bank? If they came back with a reason like 'high risk' or 'low savings' I'd have an answer but nothing except 'case refused?'. That makes me angry.

Alli

I work for a bank (not aib) and I was refused the delayed start despite being sent a brochure outlining the flexible options available to first time buyers (including 100% mortgages) - they just didn't update their documentation.

I didn't start asking whether it was personal or whether they were refusing everyone. But unless you have a contract with the bank they don't have to provide you with anything mentioned in the brochure.

Alli said:

Plus, it's a waste of money to us to do this!

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No it isn't. In fact you will save money in the long term by not taking the deferral. The way these things work is by adding the interest over the deferral period to the loan balance, resulting in increased interest and repayments over the rest of the loan term. No such thing as a free lunch.

The purpose of this facility is to help people with cash flow problems. Since you don't appear to fall into that category, as you say you can afford to pay the rent and mortgage at the same time, you would be wasting money if you DID defer.