Halifax mortgage & credit score

lestergun

Hi y'all,

Have a couple of questions related to a potential mortgage with Halifax.

I went (a couple of months ago) for a mortgage interview (with Halifax) and was provided with an Agreement in Principle / Decision in Principle / Mortgage Promise.

They use a rating calculation that (I think) goes like this:

A - Halifax will potentially lend you up to 90% LTV.
B - Halifax will potentially lend you up to 85% LTV.

I was told that I got a 'B' and the bank would potentially lend me 85% of the purchase price of a property.

Issue is: I've seen a property I (really) like and with a bit of luck and negotiation, could chip some (4% is the hope) off the asking price but would still have only a (roughly) 10% deposit.

I've reviewed my behavioural history as recorded with Equifax, Experian and CallCredit and the only issue (separate to volume of credit agreements, which I'll get to in a mo') is a late payment from many years ago that *should* disappear next month.

Would it be optimistic to think that the absence of the late payment on my credit file would lift me from a 'B' to an 'A' in their eyes (and gaining a 90% mortgage)? I recognise that this question is fairly nebulous, given all the factors taken into account, but hope someone with familiarity of the process could advise.

Credit agreements:

I have three credit cards (Amex; Mastercard & Visa) with a combined limit of ~£15k. I pay the balance in full every month by DD and have never missed a payment. The current combined balance is ~£30) - I try and use them where there's a relevant offer or cash back and generally for small sums.

Current accounts: I have four (First Direct (main); TSB (use this for the 5% on £2k; Nationwide (use this for the 5% on £2.5k) and Halifax (use this for the £5pm reward plus £5k saving raffle (if that's what it's called). Have never been overdrawn in any of them.

As an observation, is this too many (three CCs and four current accounts)? To me, it seems like a 'normal' amount although would appreciate any feedback.

So - will closing a credit card and two current accounts, plus a late payment dropping off my credit file lift me from a 'B' to an 'A' to obtain the coveted 90% mortgage? Or any combination of the above?

Thanks

Lester

Dave_Ham

Why are you limiting yourself to Halifax when looking for a 90% ltv product?


Halifax are not necessarily the most lenient lender at 90% currently.

Thrugelmir

lestergun wrote: »

As an observation, is this too many (three CCs and four current accounts)? To me, it seems like a 'normal' amount although would appreciate any feedback.

When will you ever borrow £15k on credit cards? A personal loan offers a far better rate of interest in the main for major purchases.

Why do you need four current accounts? I assume that the cash on deposit is your savings for the property purchase.

lestergun

Dave - I'm a contractor and they *appear* to be the most contractor- friendly.

Thrugelmir - Yep, the cash in the current accounts is getting a modest amount of interest (but is capped to a value, so spread around) which will form part of my deposit. The credit cards: One has a low APR (4.9%) which I want to retain if I need to make a large purchase in the future, another is a card I use whilst on holiday (good exchange rate, no fees for cash or payments). I'll maybe close the other.

lestergun

Dave_Ham wrote: »

Why are you limiting yourself to Halifax when looking for a 90% ltv product?


Halifax are not necessarily the most lenient lender at 90% currently.

Dave - I also hope they return to the market with the 90% LTV @ 2.99%.

amnblog

You won't know where you stand until you put the full application in with Halifax.

We cannot second guess what score you will get. How Halifax score ( or indeed any lender) is kept confidential, even their staff won't know.

Dave_Ham

Not much chance of the return of the rate


They can be contractor friendly assuming you are earning in excess of £500 a day, or £75k for the year


Outside of this, they are not playing much at 90%/95% ltv (probably hence the rates) although there are likely to be other options if your automated score has not increased.


You need to ensure your broker/local advisor keys everything 100% accurately. We have seen clients limited to 65% or 85% and details are not accurate and we still achieve 90%


Good luck though, do update this thread with how you got on

lestergun

amnblog wrote: »

You won't know where you stand until you put the full application in with Halifax.

We cannot second guess what score you will get. How Halifax score ( or indeed any lender) is kept confidential, even their staff won't know.

Hi Amnblog - Thanks for the response - this is kinda what I suspected. I'll wait until the late payment has disappeared and then put in a full application and *hope* they say "Well done, you scored an 'A', please take 90% of your property purchase price from us."

Presumably the score can vary between the AIP/DIP and the full application?

Thanks

lestergun

Dave_Ham wrote: »

Good luck though, do update this thread with how you got on

Hi Dave - will do (although may be a couple of months.

Thanks all for your responses.

amnblog

lestergun wrote: »

Presumably the score can vary between the AIP/DIP and the full application?

Thanks

It can, and often does.