Is switching bank account going to affect my mortgage application

Tat111

Hi,

I am thinking of closing my bank account from HSBC and switching to Halifax, as they offer £125.00 to switch.

I will be applying for mortgage at the end of this year and was wondering if I switch to Halifax-this will mean that I will be with my new bank for less than a year, does anyone know if this is going to affect my mortgage application?

Many thanks

Tatiana

dax42

Hi Tatiana,

Yes, it might affect your mortgage application, since it will affect your credit rating. The credit rating has a section on how often you've missed payments/have been 'in the red' for each open account. If your account is really new, even if all payments were made or you were always in credit, this will lower your rating since there's only limited data available. Also, as far as I know, there will be a credit search for opening a new bank account and if you have lots of credit checks on record, again this reflects badly (although if this is the only check on there, I don't think it matters much).

So in essence, if your credit rating is great right now, this would probably not hurt it so much that you wouldn't get a mortgage. However if your credit rating is a bit shaky, you might be better off keeping your old bank account open.

Hope this helps. All the best!

LeoTLion

I changed banks about 6 months ago and it had zero impact on the online credit rating. How relevant those ratings are is another matter.

My old account, which I'd had for 16 years, also still shows, so all of the info is still available for lenders to see.

Thrugelmir

LeoTLion wrote: »

My old account, which I'd had for 16 years, also still shows, so all of the info is still available for lenders to see.

Some older bank accounts are not declared to the CRA's as there's no authority held to do so.

LeoTLion

Mine still shows on both experian and check my file as a closed account.