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Halifax Approved My Mortgage but Now Declined after I have sold my House !

Last post Thu, Jul 15 2010, 7:37 AM by brenthill. 13 replies.
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  •  Thu, Jul 15 2010, 7:37 AM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Thanks for the advice, Yes Halifax did value the property I am buying so the offer they gave me was more than just in principle and I have a£70,000 deposit and the loan amount is £200,000 which should be more than enough, I agree I really need to know the reasoning that the under writers have for declining me but they wont even tell there own complaints manager so I really don't know where to start !
    • Post Points: 5
  •  Wed, Jul 14 2010, 11:11 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    In my opinon something appears to have been over looked here.

    In the first instance, you got a yes to the Agreement in Principle which is always a good start, you can't continue the application without it. From here you submitted your application, paid any fees, submitted documentation for underwriting.

    Was your new property valued? Did Halifax give you a Mortgage Offer? At what point did you find out that they had subsequently declined you?

    Untill you get a formal Mortgage Offer the agreement that was given to you in the earliest stage is only IN PRINCIPLE. This means that the lender is happy to lend you the money as long as you meet all the product, lender and property criterion and this means that the mortgage can fall down at any point for many many reasons, I have had an application fall down at the last minute for a client going £20 over drawn on his bank statement and this was enough to tip the lender the wrong way.

    The most important thing is that you did not have a formal Mortgage Offer from the lender and that it was only In Principle and who ever told you that you could now sell your house is going to have aot of questions to answer in my opinion. The lender has the right to refuse a mortgage for any reaon it sees fit (although I believe they do have to disclose their reasons) and can and often does exercise this right when they need to.

    Before you appeal the decision you need to find out why you were declined, how can you appeal when you do not have a reason for the decline. if you don't have a reason for the decline how can you argue that they are wrong, its like arguing that black is white but only on your say so. You will most likely need to back your appeal with documentary evidence.

    In most cases the decision remains but if you can find out why you can at least argue your own case. If the decline was after Mortgage Offer then I would imagine that the problem lies with the property and not the applicants.

    So far as a new lender, this could be a toughy. Most lenders don't like CCJs at any point but they are slowly coming back around to the idea of slight sub prime (how quickly they forget). I think the biggest issue that the lender will have if you have a ccj is the loan to value that you are borrowing. While I am suprised that Halifax even accepted you I can beleive that this could be the case if you are borrowing a reasonably low LTV, maybe 50%-70%. this is the level that lenders start to worry less about your credit history and will let a few things squeeze through. However, if Halifax have now declined I would imagine that most other lenders will follow suit. Definately have a long conversation with your mortgage broker and maybe even go and speak to a different broker to check he is giving much the same advice. As stated before you do not want to apply all over the place. You may have a chance with a lender like Coventry BS or even Platform, even Alliance and Leicester and Abbey accept small adverse credit now. make sure your beroker calls the lender to put the scenario past the sales team and mayber even an underwriter before submitting anything more formal.

    You may have to face a higher rate if you really wnt your new home, but this is a decision that you will have to make and don't apply to too many lenders befroe coming to this decision as it may be too late by then.

    Good Luck. I hope it all works out for you

    • Post Points: 20
  •  Wed, Jul 14 2010, 9:22 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Every time you are credit checked the lender leaves a foot print in your file. Multiple credit checks over a short period of time can impact your credit score. From a potential lender's prospective, it also looks bad if there are a lot of credit checks over a short period because its seen as a good indication that you have asked for something which other lenders are refusing to give you. This puts you under the banner of being higher risk to the lender and may result in a decline. As such, its always a good idea, where possible, to avoid being credit scored unless its absolutely necessary.

    If you decide to go to a new lender, its best to check their policy before applying, just in case.

    Also lenders are currently regulated by the FSA and should all abide by the Treating Customers Fairly Scheme. If you tell them you believe they are not abiding by this scheme it should help.

    • Post Points: 20
  •  Wed, Jul 14 2010, 9:06 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Yes thats helpful, I will see how the appeal comes back tomorrow and if its still a decline i will ask the complaints manager if i can speak with the underwriters, does the credit score actually go down if you keep getting credit checks or does it just look bad that there are lots of credit checks on your file ?
    • Post Points: 20
  •  Wed, Jul 14 2010, 8:55 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Hi,

    Really sorry to hear about your situation. I have worked for Mortgage lenders in the past, one for many years.

    It's rare for them to change their lending criteria so quickly so it does sound like it may be a bit of an excuse. I have spoken with many customers in your position and I understand the stress it causes.

    In these situations its always useful to speak directly to the underwriter who has declined your case of if not to the head of underwriting. They should be able to justify why they have taken that decision. Most lenders do allow their underwriters to talk to customers directly and in some cases this can result in the case being looked at again.

    If you have a concern you should still log the complaint, but definitely ask to speak with the underwriter. In most cases when you only log a complaint all the complaints team do it speak to the underwriter anyway and then come back and repeat what has been said to them by the underwriter.

    The other thing you may wish to take into consideration is the fact that when you do a Mortgage application with a lender, they will credit score you and other lenders you now go to will see that they have done this., This may impact your ability to get a mortgage off another lender. If you feel you have been misled and the lender agrees, you may wish to consider asking them to take their print off your credit record so you can at least approach another lender without having to worry

    Hope this helps and best of luck

    • Post Points: 20
  •  Wed, Jul 14 2010, 8:51 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    They've said the income was not an issue as I actually submitted more than we originally thought. My CCJ was for £388 in 2006 but I cleared and had it marked as satisfied in March this year. My broker has said she will ring around lenders tomorrow to see if theres anyone that will take us as we have our hearts set on this house and would hate to lose it !

    Do you think there is anyone out there without an extortionate rate ?

    • Post Points: 5
  •  Wed, Jul 14 2010, 8:45 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Thats exactly what I'm going to do, I really feel that I have been wronged and it has caused a lot of stress even if they do not change the decision which is what i would ideally want, i think i am certainly owed compensation for how they have handled the whole process. Our house sale has already fallen through once but is sold again for the moment, we have bought another house off an elderley couple that are kindly waiting for us but the gentlemen is ill and certainly won't need any bad news. Anyway what ever happens you're right and I will take it to the FOS !!
    • Post Points: 20
  •  Wed, Jul 14 2010, 8:42 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Hi there, I am an independant mortgage broker and have been for 10 years. I know how lenders work and although its not want you want to here forget it they will not change their mind. It is worth noting that halifax dont have anything specific criteria about CCJ's, normally if you pass credit score then they will honour it as long as the information you gave them is verified. It may be worth asking the broker for a copy of the application as this will state what income you put down and alike to make sure it is the same as the income you verified. Halifax rates are very poor anyway so im sure you could get a better deal, im sure i myself could find you a deal to fit you circumstances. How long ago was the ccj and for how much. When was it satisfied?

    • Post Points: 20
  •  Wed, Jul 14 2010, 7:19 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Thanks for the advice but I can't help feeling that I have been treated very badly and should never have been told to look for a house and sell my own, somewhere they have made a mistake, perhaps they should not have ok'd it at the earlier stages, somewhere along the line something has gone wrong that will cause more stress to others in the chain, as you said earlier they could at least be decent enough to give me a clear reason so i can try and get this resolved !! anyway enough ranting, hopefully the appeal may work !!
    • Post Points: 20
  •  Wed, Jul 14 2010, 7:17 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    brenthill:

    the complaints manager has said that i can go to the financial ombudsman but will this help me get the mortgage or should i start looking elsewhere ? This has caused so much stress for my family and ruined a recent holiday...


    In the face of the alleged change in criterion during the application process and the refusal to explain the criterion or the change, IMHO you owe it to yourself and your fellow bank victims to ask the FOS to consider whether the bank's behaviour has been reasonable. However it is not a quick process (might take from 6-12 months) and it is not a certain process. You should not see it as a means of changing the decision. It *might* produce a compensation and/or a distress and inconvenience (D&I) award. The one thing which is certain is that the FOS process will cost you nothing but the bank will incur a hefty case fee of several hundred pounds regardless of the outcome. That might make you feel better.

    In parallel with the FOS, you should revist your broker for advice and consider strongly whether you are happy that the broker really worked for you. I haven't followed your thread for the reason for the mortgage now but most indicators are that there is no immediate likelihood of house price inflation, so perhaps no real need to rush.

    • Post Points: 20
  •  Wed, Jul 14 2010, 7:07 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Waste of time going to the FOS. They will take 6 months or more to look into this and they won't involve themselves in Halifax's underwritting decisions, only the application process.

    Suggest that you get working on looking at alternative mortgage providers.

    The mortgage underwriters don't always like to be challenged, as you have found out.

    • Post Points: 20
  •  Wed, Jul 14 2010, 6:51 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Thanks for the reply Huxter, thats exactly what I have done, I have taken it to the complaints department and I have actually spoken with the complaints manager, she has taken the case back to the Business assessors to get to the bottom of the decision but they will not give her a reason and have said they donot have to give a reason, all they have said is that I do not meet their lending criteria. The complaints manager has now told me that the assessors have said i can appeal this decision but it is unlikely to change as I nolonger meet their criteria. I know that my credit file hasn't changed from the start of this process and that they were fully aware of the satisfied CCJ from the start, I think it is a simple case that as it has moved from one department to another that somebody has changed their mind ! So it is now going to appeal but is there any thing I can do if it comes back declined again ? the complaints manager has said that i can go to the financial ombudsman but will this help me get the mortgage or should i start looking elsewhere ? This has caused so much stress for my family and ruined a recent holiday !!
    • Post Points: 35
  •  Wed, Jul 14 2010, 6:36 PM

    Re: Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Ask your broker to find out exactly how you no longer fit the criteria. Unless you are given reasons, it would make it difficult to know what you had to do, to resolve the situation.

    Your broker if they are helpful, should obtain this information quite quickly and perhaps suggest a way forward.

    Personally I don't like to take no for an answer. What you will find in most companies, is that there is an appeals or customer relations type team, that you can speak to, to see if you can have your file reviewed again. Decisions are sometimes made and then upon review, a change of mind can occur if you are persuasive enough. Don't allow them to sit in their ivory towers, lead you up the garden path and then suddenly say you don't fit their criteria.

    • Post Points: 20
  •  Wed, Jul 14 2010, 6:19 PM

    Halifax Approved My Mortgage but Now Declined after I have sold my House !

    Can anyone give me some advice please ? About 4 years ago I got a CCJ so thought I wouldn't be able to get a High Street Mortgage but my broker phoned around and said the Halifax said they would take a look if I paid it all off and it was marked as Satisfied on my credit file. So I did all this and we went back to the Halifax who then were fully aware of the CCJ, even so they agreed in principle to the mortgage. I then submitted all of my accounts and P60s, bank statements etc as requested to the Halifax Business ssessors and again they said this was fine and was given the go ahead to look for a property. I found a house, have sold mine but last week I was told that I nolonger fit the Criteria and have been declined. I subscribe to equifax and know that my credit file has not changed since the Halifax agreed to this Mortgage so can any body advise me as I don't want to lose the house that I am buying !!
    • Post Points: 20