HSBC mortgage application declined

Hoopie1

I applied yesterday for a mortgage from HSBC to remortgage my existing property. They have an attractive deal on at the moment and it would save me a fair amount of money. Having completed the form (with a lot of detail) and then gone through my application with an adviser on the phone, my application was declined due to my credit profile (they initially told me they didn't know why, I informed them that they were bound by FSA regulations to specify why and they relented and told me).

I found this rather odd, given that I have never had a credit problem in my life. I meet all the credit hurdles (the amount I am looking to borrow is less than 1x my gross annual basic salary and the LTV on my property is no higher than 35%, the hurdle rate for the product is 60%)

I went to the three credit agencies (Experian, Equifax and CallCredit) - I am awaiting a response from Experian and CallCredit after they verify my ID, but I did manage to obtain my Equifax report. I find it absurd that I should have to pay these companies to verify my own information, but that's another matter, I guess.

Anyway, my Equifax report shows everything to be either "Excellent" (in most categories) or "Good" (in two categories). It shows no amounts overdue or any CCJs or similar against me.

However, there is a record of a CIFAS warning ("victim of impersonation") on my record. At the back end of last year I received a letter from Littlewoods about a £900 store credit card limit. I have never shopped there or applied for this. They cancelled the card (which had not been used) and mentioned something about putting me on a fraud database, which is (I guess) CIFAS.

My credit score is 438 (out of 600 on the Equifax scale, so they tell me). Equifax also tell me that my score is for my eyes only and that HSBC only have access to my credit report (I'm dubious about this, but I'll take their word for it for now, I guess).

I assume that when I get my reports from the other two agencies, they are going to show roughly the same thing. HSBC said that if I think there is an error on my report, then I need to go with my report into a branch and deal with it there (I can't imagine how painful doing this is going to be).

I have two issues here:
1) The CIFAS note on my file is not an error - it is factually correct to say that I was the victim of impersonation, so I can't really ask for it to be removed from my report. However, the fact that it evidently counts against my ability to obtain credit (when my record is otherwise unblemished) is both absurd and completely unfair.
2) How on earth do I manage to talk HSBC around when I can only assume that I am going to get a "computer says no" series of responses from them when I have all my information and visit them at a branch?

Any suggestions or input would be gratefully received.

Hazzinho

Cifas won't affect your application, they may have done additional checks. It might be that you have used a high percentage or your credit? Also are you on the electoral role? The other thing might be they've met a quoto of applicants and so that's why you were rejected. it happened to a friend of mine.

Thrugelmir

Hoopie1 wrote: »

I found this rather odd, given that I have never had a credit problem in my life. I meet all the credit hurdles (the amount I am looking to borrow is less than 1x my gross annual basic salary and the LTV on my property is no higher than 35%, the hurdle rate for the product is 60%)

Then you may not meet the HSBC's lending criteria. How long does you mortgage have to run?

The_Palmist

May be your credit history is too good.

Hoopie1

Hazzinho - unlikely, the only debt I have is my mortgage and a credit card that is cleared every month. I am on the electoral roll. If they have met their quota of applicants then they have lied as they told me I was declined for credit reasons.

Thrugelmir - my mortgage has 15 years left. I was going to shorten the term here. I am happy for them to reject me for any commercial reasons, but they have said I was declined for credit.

Palmist - possibly, but that isn't a reason to decline me here. Even one of the high street banks would struggle to tell that one with a straight face. If they are selling this as a loss leader with a view to flogging me other stuff (which I don't want) and want to decline me for that reason then that is fine, but again this isn't credit.

Thrugelmir

Hoopie1 wrote: »

Thrugelmir - my mortgage has 15 years left. I was going to shorten the term here. I am happy for them to reject me for any commercial reasons, but they have said I was declined for credit.

What FSA regulation forces them to tell you?

The EU has mooted the concept, but I am not aware there is any current regulation. The call centre would not have access to the underwriters. So maybe you were just told something to placate you.

HSBC declines more applications than it accepts.

sutwam

Hi

My partner and I applied for a HSBC mge having checked our credit scores and we both had 999 out of 999 and yet we had a "computer says no" responce.

But the mge person in branch was excellent. We sat down went through everything and she put our application back in and we was accepted, so it might well be worth a trip to the branch if the rate is worth it

kingstreet

sutwam wrote: »

Hi

My partner and I applied for a HSBC mge having checked our credit scores and we both had 999 out of 999 and yet we had a "computer says no" responce.

But the mge person in branch was excellent. We sat down went through everything and she put our application back in and we was accepted, so it might well be worth a trip to the branch if the rate is worth it

I suggest going early in the week/month and preferably in the morning. The HSBC system will weed out and decline better quality applicants as it reaches its target lending for its business period. A qualifying credit score may be changed by the lender at its discretion.

It may simply be the timing of your first application was bad and your second, better.

lightspeed

As previously mentioned, make an appointment to se a mortgage manager in branch.

You will find that they can speak to underwriters direct and if they feel confident about your application provide a few gentle pushes and prods.

trulysaintly

lightspeed wrote: »

As previously mentioned, make an appointment to se a mortgage manager in branch.

You will find that they can speak to underwriters direct and if they feel confident about your application provide a few gentle pushes and prods.

One thing to be wary of though is that there's no guarantee of success - some lenders will cross reference the first application made, and may not allow you to apply again for a period of time.

The amount of clients I see who have attempted applications themselves based on 'Best Buy' tables in the press or price comparison sites - who then get turned down or offered a higher rate than they wanted - is large.

Just a hint - Best Buy tables = paid for ads
Price Comparison Sites - mainly the same.

Getting independent advice is your only way of knowing what YOU qualify for before credit scoring is complete.

Hoopie1

All - thanks for your responses, I will seek an appointment at a branch.

Thrug - I think stuff like this falls under TCF?