Halifax offer

zak74

We applied for a mortgage with Halifax last Wednesday and got our offer this afternoon. Just reading through it. Does anyone know what this means:

You have declared an intention to repay some or all of your
outstanding credit commitments. The mortgage advance has been assessed on this basis and it is your responsibility to ensure that these commitments are repaid. Completion takes place on the condition that such repayment takes place.

Except where such a mortgage is an outstanding credit commitment you have declared an intention to repay, we agree that any existingmortgage you have on any other property does not have to be repaid when you take out this mortgage

okborednow

Funny enough i have an offer from Halifax and it says the same thing on mine. I queried it and was told it was a standard paragraph unless they specifically list things you have to repay.

zak74

okborednow wrote: »

Funny enough i have an offer from Halifax and it says the same thing on mine. I queried it and was told it was a standard paragraph unless they specifically list things you have to repay.

Thanks, that puts our mind at rest!

Goldiegirl

Whoever keyed your application, whether it was a broker or a branch advisor, has entered your credit details on the system and has told the system that you will repay some or all of those credit commitments.

The affordability has be calculated on the basis that those credit commitments will be repaid in full at or before completion.

So you will be expected to clear those credit commitments.

You'll need to check with your broker or advisor to see which commitments are to be cleared.

kingstreet

I agree. This is not a standard paragraph.

On our cases' offers, it is only there where the applicant has told us they intend to repay certain credit commitments on, or before, completion.

Where they have not done that, the clause does not appear in the offer.

Gg is correct.

zak74

Just great! Feeling very worried now

kingstreet

nicnac3011 wrote: »

Just great! Feeling very worried now

You need to establish if the application was submitted correctly.

I give my clients a copy of the application so they can see what I submitted on their behalf.

zak74

I have emailed our financial advisor. If he has given wrong information, can and how does it get fixed?

kingstreet

An alteration needs to be made on the Halifax online system.

A box asks the total value of your credit commitments each month and you would add together loan repayments and 5% of a credit card balance.

Another box asks for total value of credit commitments to be repaid on or before completion.

For example, if you have £400 a month credit commitments and they are all to be repaid, the two boxes are completed "£400" and "£400."

If you intend to repay none, the two boxes should show "£400" and "£0."

If you intend to repay £100, the boxes would read "£400" and "£100."

If your mortgage is considered affordable without the credit being repaid, making this alteration will have no impact. If it isn't, you'll be offered a lower amount, or a longer mortgage term, what's known as an alternative lending proposal.

I get the impression some brokers and Halifax employees manipulate this, knowing Halifax does not check the actual repayment of these commitments.

Goldiegirl

KS, I think you are correct to suspect that some brokers and Halifax staff manipulate the system.

When I was at the Halifax, in a mortgage processing role, if I got wind of the fact that a customer WASN'T going to repay credit, I'd amend the application to show the correct situation. But being in a non sales role, my interest was to do things right, not to meet sales targets.

Once the mortgage is completed, it would but VERY unlikely that the Halifax would find out that the commitments weren't repaid.

But sometimes it would come to light. For example, a customer would apply for a further advance, and we'd see that they still had credit commitments that they should have repaid at completion. In those cases it was goodbye further advance!

okborednow

Hmmm well i spoke to Halifax and they confirmed my application had been keyed that i was going to pay off my credit card and my loan whereas i only intended to pay back my loan. I spoke to my broker who has gone into the application and updated it and it's stayed at offer status. She says we'll now get a revised offer on that basis but no other details will change re amount of offer etc. Thanks KS and GG for advising i get it checked out and Nicnac for asking the question.