Mortgage Application: Reason for Decline

Jonny0000

Recently got declined on HSBC's automated mortgage approval and had to do some digging into why this could be.

Both applicants have an Experian credit score of 'Excellent' and salary / work history is good.

My question is, what impact can missed payments on credit cards and mobile phones etc have on the application and does how recent they are make a huge difference?

There are a hand full of missed payments caused by stupidity rather than any financial hardship.

Will this effect all mortgage applications & is the appeals process worthwhile?

Senior_Paper_Monitor

Very much so, particularly at high LTVs - and particularly with HSBC.

By the sound of it you are not going to get the cheapest lenders.

It is important that you don't continue applying on random basis driven by 'best rate' as more applications/declines will not help your credit file.

Speak to a broker and obtain copies of both your files to give to him/her and let them match a lender to you that is likely to accept.


.... and no, an appeal to HSBC will be c complete waste of time

betmunch

Seconded for SPM.

Definately get the credit reports printed out. "a handful" of missed payments is very wooly.

Need to know the exact number and when they happened. Also stupidity isnt a good enough reason to miss a payment.

I guess whether or not you will be accepted with a high street bank will depend on the size of your hands.

Wh05apk

I think this shows the true value of experian/equifax credit scores - you are "excellent" yet have been declined!

Use credit agencies as the lenders do, to get your credit info, then make your mind up whether you are "excellent" or not, as has been said, HSBC are picky, and will not entertain any missed payments, some lenders (such as Halifax/possibly Nationwide) are more tolerant depending on LTV/Dates etc.

Get your reports and speak to a whole of market broker, who will be able to get you the "most suitable" deal which may or may not be "the cheapest" deal.

Conrad

Jonny0000 wrote: »

There are a hand full of missed payments caused by stupidity rather than any financial hardship.

Lenders don't want lax payers. How would you feel if your boss ad - hoc paid your wages late?

Civilised society depends entierly on trust and people expecting something that's been promised.

Be aware that the majority of people never miss a payment in thier life.

The excuse I most often hear is "but I was on holliday" which is THE weakest excuse for not managing finances. What has being on vacation got to do with planning finances properly?

jamesperrett

Conrad wrote: »

Be aware that the majority of people never miss a payment in thier life.

In the 80's I regularly missed credit card payments. All that seemed to happen was a reminder on the next statement and a more strongly worded reminder if I missed more than one. I was still able to get credit from both the bank that ran the credit card and other sources so it didn't appear to be a problem.

Nowadays it would appear that banks take missed payments much more seriously and I have direct debits set up for all my credit cards so that at least the minimum payment is made each month.

James.

Gentoo365

I imagine that they were more tolerant as more people paid by cheque, or even by going into the branch. So a late payment was more likely.

Nowadays almost everyone has a direct debit set up, and almost everyone has some sort of overdraft facility.

This means that a 'couple' of late payments can seem a lot more serious.

It's not completely harsh though. I had a missed payment due to closing down a current account and forgetting to change bank details for a credit card payment.

As soon as I received their letter I paid over the phone and changed the bank details. It did not even appear on the credit record. So there must be some sort of 'lead time' before someone actually counts as a missed payment.