AIP Rejected with Halifax

irdan87

Hi guys,

Trying to get a mortgage through Halifax using a broker. It came back rejected on the AIP but both our credit checks are fine.

The broker thinks the issue is quite complex and involves our cars; we are both self employed and our car payments come out of each of our business accounts BEFORE we post end of year profits.

So she spoke to Halifax and the lady there said to not include them in monthly outgoings as like above, they are taken before profits are posted. Ie. My profit last year was 35k AFTER car so to add them as an outgoing would make my profit roughly 28k or I could declare it but post profit of 42k (this wouldn't tally with my accounts though). My partner is the same however smaller payments on her motor.

So we did as the Halifax advisor said and left off the car payments however I can only assume on the checks the outstanding finance came up which we 'didnt declare' and the computer failed us. She has appealed to Halifax which is going to manual underwriting and we now probably won't hear until Tuesday (going to be a drag this bank holiday!)

What is the likelihood of this being overturned on the basis of above?

Thanks

kingstreet

It is not as easy as you are being told. Disclose them, or leave them off, the end result will be the same. You have credit commitments in your individual names.

If you are failing affordability because of this credit, the system won't decline you, it will offer an alternative lending proposal (ALP).

There is no way to appeal a decision in principle result. You have to submit a full application against the ALP result and then supply all the full application documentation before it can be referred to a Business Assessor.

They will look at your Accounts, Tax Calculations and Tax Year Overviews and ensure the credit costs are taken from gross income and not from net profit.

Assuming this works, you will have a subjective accept but at each stage your application then has to be signed-off by the Business Assessor.

irdan87

Thanks for the reply mate.

To be honest our broker has been pretty poor from the offset so I'm not surprised I haven't been told the 'full story'. From the initial appointment I was told I could start viewing properties and could borrow up to 230k and add my deposit on top of that.

We then had an offer accepted on a property for 242k which has led to all this unravelling and her panicking bouncing from lender to lender to find one which will accept us. She seems very desperate to find a lender now due to her broken promises to us. We are FTB so we just assumed from her phone call we could proceed and put in an offer.

We have also paid £250 to her recommended solicitor firm and presented all documents as she advised we did ASAP to get the ball rolling.

She has submitted a full mortgage application on our behalf to try and get it manually underwritten.

God knows - heads up my !!!! now and not very hopeful after this past fortnight.

Perhaps time to wait another year for more improving accounts or to lower expectations on FTB.

Frustrating thing is if I was told from day 1 'hang fire' or 'you can borrow up to 150k' etc I'd have been delighted but to have been through this and expecting to land our dream home straight away with no intention of ever moving again has left a bitter taste.

amnblog

Any experienced and competent broker should not have a problem with handling the car issues.

As ever, KS is on the ball on this.

You seem to be committed to following through now that a full application has gone in, but if you don't get a result, change your broker.

Thrugelmir

irdan87 wrote: »

To be honest our broker has been pretty poor from the offset so I'm not surprised I haven't been told the 'full story'.

If you push your broker for answers. Then they can only guess. The decision made lies elsewhere. Not just a question of meeting set criteria either.

irdan87

Ok so an update..

We had to submit a full mortgage application to be manually underwritten.

Had a call this evening from our broker to update (application went in Thursday)..

They are now asking for my employed p60 from 13-14 although they are only using my last year self employed accounts..more hurdles.

Also..unbelievably..my partner and I both registered with experian and sent our credit reports across to the MA who has attached them to our manual application (along with other supporting evidence including a letter from accountants stating cars payments go prior to net profit and a projected profit of my accounts 16-17) and both the MA and Halifax themselves are stumped as to why we are failing the credit report as there is nothing adverse on either of our reports?!

The MA said it may need to be approved manually but I really am losing all hope and patience and expecting the vendor we had an offer accepted on to of relisted his property by the end of the week (I don't blame him one bit)

Thoughts on this from those more experienced?

Funny_old_game

As a former MA and underwriter, what is the 'profit from self employment' on your SA302's? That's what the lender ultimately wants. Taxable provable income only.

If the combined income for both above is circa £50j you MAY have issues. Is the referral/decline on affordability? If so you should never have been taken tyo full application and your MA as mentioned is an a@s.

irdan87

Taxable profit is 33.3k for me 17.1k for partner plus £1450 annum child maintenance.

Halifax calculator said can borrow up to 240k roughly so she said yep go for it now Halifax are advising looking at closer to 215k IF it even gets approved!

Losing the will to live here haven't had a good nights sleep (could be the heat mind!) in days!

irdan87

Also they don't know why it's declining..neither my broker or Halifax apparently know why.

Bizarre.

Funny_old_game

The calculators can be relatively accurate, however until the info is placed on their systems you can never be sure.

As its Halifax, depending on 14-15 figures, the ones quoted may not work as they may take an average of both of your last 2 years if your latest is higher.

240k is very optimistic as they'll only take 60% of maintenance anyway.

amnblog

An important factor here is the loan to value. Is the Halifax suggestion of £215,000 because they want you to put down a deposit of 10% rather than 5%?