Mortgage promise now declined!

maj42

If my circumstances haven't changed, can the Halifax decline a mortgage if a mortgage promise has been given?

We have 5 rented properties, 3 with mortgages, all with at least 50% equity, the other 2 mortgage free. We also have our own house, all with the Halifax. We are buying another house for ourselves which will also have 50% equity in it.

We went to see them at Christmas, met all their criteria, once offer was accepted on 29th january, we went to see them and got a mortgage promise. All great. We've had a homebuyers report done on the new property, all good, valued over what we are paying. Sent the survey to the Halifax (they said we wouldn't need there's doing). Nothing has changed, they have all the information, yet the mortgage has been declined. When we asked her why, she said the new mortgage will take us over their threshold of £500,000 mortgages. I said that she knew all this when the promise was made, she said this new threshold amount was a new figure (so only came in over the last few weeks). Surely as the promise is Within the deadline (open until 21st march) they should honour this?

Any advice would be great as I'm against the clock as we are supposed to complete in 3 weeks! She told is we would be fine and now I'm left dangling!

GMS

Mortgage Promise is the worst term in existence. Pain free shark bite would be more of an accurate term!

Maximum 3 across the Lloyds Banking Group now so that looks to be the issue.

maj42

GMS wrote: »

Mortgage Promise is the worst term in existence. Pain free shark bite would be more of an accurate term!

Maximum 3 across the Lloyds Banking Group now so that looks to be the issue.

Thank you for your reply. So they can go back on this? Surely they should honour if with it being within such a short timescale? Also, she told us 3 or 4 times we would be good for it, she told us to get the survey done, start the solicitors, the offer was in from December and accepted end of January, all this time she said we would be fine so we have pressed go based on her advice, £1,500 later we look like we might lose it!

GMS

I would ask for a refund of fees as you were outside of criteria which the 'adviser' should have known.

A Decision in Principle/Mortgage Promise etc is not set in stone. Lenders can decline any application they choose.

Yours has been handled poorly by Halifax staff.

Find a broker who should be able to find solution(s) for you.

ACG

Does it not have some small writing on it somewhere statin its not really a promise or its subject ot meeting their criteria?

But yes they can refuse the mortgage at any time they wish.

maj42

No small print, it just says that they will give us the mortgage if:
The information we have given is correct (nothing has changed so it is)
A satisfactory assessment of the property (which we have supplied)..

It doesn't say anywhere that they could change the rules, I'm left hanging and I really want that house! I have complained to the lady at the Halifax and asked if there is anything we can do, we are a fantastic customer, excellent credit score, never default on payments, and if she hasn't said we would be good for it we wouldn't have taken it any further! She is referring it up to her manager so we are just waiting. I am kind of hoping that her manager will give is a different answer seems as though she has strung is along. I'm appealing to her good nature in the hope of some good news.

maj42

GMS wrote: »

Mortgage Promise is the worst term in existence. Pain free shark bite would be more of an accurate term!

Maximum 3 across the Lloyds Banking Group now so that looks to be the issue.

So what would happen if I already had 4 when this new rule came in? Would I have to move one of the mortgages?

GMS

maj42 wrote: »

So what would happen if I already had 4 when this new rule came in? Would I have to move one of the mortgages?

No. Criteria changes all the time but they will honour the original agreements. I have a client with 10 Halifax mortgages. He pays, they accept and the agreement continues.

dunstonh

I said that she knew all this when the promise was made, she said this new threshold amount was a new figure (so only came in over the last few weeks). Surely as the promise is Within the deadline (open until 21st march) they should honour this?

Problem is that mortgage in principle decisions are basically nothing more than "if you were getting the mortgage today we would lend you the money". They dont take account of criteria changes that occur in future.

Criteria changes only apply to new borrowing. Not existing.

Thrugelmir

maj42 wrote: »

met all their criteria,

Until a full application is submitted this is never the case. As the lenders criteria can change at any time. Given your details an underwriter has reviewed your application and more than likely has concerns.

The problem with leveraging up with debt. Is that while there is equity. The focus will be on the cashflow required to service the debt. When cashflow dries up then the problems arise.

Wh05apk

To be honest, this will likely be a blessing in disguise, Halifax rates generally are not competitive, so I am sure you will find much better rates elsewhere.