Refused mortgage application due to failing credit score with equifax

sartois

Ok so I am a little bit confused.

I have a mortgage with the Halifax, no problems whatsoever but wanted to switch the mortgage to clear the help to buy that I used initially to buy it so was looking to increase the mortgage to cover the amount I borrowed from Help to buy.

I just went through the application process (a gruelling 1 hour video call) and the final check by the Halifax mortgage advisor was to check the credit score on Experian (I had no idea that the banks used this - I thought they used their own credit scoring system). No problem I thought, my score on Experian is 976, should be an easy pass - but it came back as a fail. The Halifax guy couldn't tell me why it failed and said I needed to contact Experian to find out why as he was unable to get any additional information from the 'system'.

So I've sent a message to Experian asking why (although on their FAQs they point out specifically that they cannot tell a person why credit was refused and I should contact the institution that rejected the application) so now need to wait to see if they can tell me. I have
ClearScore and there is absolutely nothing on there either that can cause this - although interestingly they seem to give me a score of 414/700 which seems somewhat low although there isn't anything on that report that indicates why its low.

By the way, I have no defaults, CCJs whatsoever, am on the electoral role since 2015, have 3 credit cards that when used are paid off every month and my credit history should be just about perfect.

Not really sure what to do now - the Halifax guy said that even if it is a mistake by Experian I would need to wait 3 months to re-apply so their system could update. There is no human it can be escalated to in Halifax once the system has said no either. Bonkers.

National_Debtline

Hi Sartois,


Credit files are quite complicated documents, your history is constantly influenced by many factors to give you your overall rating. Future lenders do not see the score generated by the credit reference agencies, they only see your history. Your history shows things such as whether or not you are on the electoral role, anyone you have financial associations with and, of course, your financial history.



These factors, mixed with your application for credit, will be assessed by the lender's computer to determine if you qualify for credit or not. The banks will use one of the 3 credit reference agencies when checking your eligibility for credit and they all hold slightly different information. You can check all 3 to see if you can see any negative information that may have affected the application.


Laura
@natdebtline

MovingForwards

How much credit is available to you on the 3 credit cards?

How much is the Help to Buy loan that you want to pay off?

What is your yearly income?

BTW ignore the scores they are just a bit of fun, check through all open/closed accounts to make sure no defaults or anything else are listed.

[Deleted User]

You've probably realised by now that the CRA score are made up and meaningless, so You need to look closely at the data on all three files.

If you do have soon established track record of good credit management, then affordability is the next likely issue. After that, it will come down to the specifics of Halifax's criteria, which are confidential.

[Deleted User]

sartois wrote: »

Ok so I am a little bit confused.

I have a mortgage with the Halifax, no problems whatsoever but wanted to switch the mortgage to clear the help to buy that I used initially to buy it so was looking to increase the mortgage to cover the amount I borrowed from Help to buy.

I just went through the application process (a gruelling 1 hour video call) and the final check by the Halifax mortgage advisor was to check the credit score on Experian (I had no idea that the banks used this - I thought they used their own credit scoring system). No problem I thought, my score on Experian is 976, should be an easy pass - but it came back as a fail. The Halifax guy couldn't tell me why it failed and said I needed to contact Experian to find out why as he was unable to get any additional information from the 'system'.

Rubbish - lenders don't see the made up CRA scores. So the person you spoke to doesn't know what they're talking about. You would have failed on Halifax's own internal scoring metric, not the made up CRA score.

So I've sent a message to Experian asking why (although on their FAQs they point out specifically that they cannot tell a person why credit was refused and I should contact the institution that rejected the application) so now need to wait to see if they can tell me. I have
ClearScore and there is absolutely nothing on there either that can cause this - although interestingly they seem to give me a score of 414/700 which seems somewhat low although there isn't anything on that report that indicates why its low.

Experian will not know or tell you why you failed to pass Halifax's internal criteria, and Halifax are not obliged to provide that information either. Ignore any scores from ALL CRA's

By the way, I have no defaults, CCJs whatsoever, am on the electoral role since 2015, have 3 credit cards that when used are paid off every month and my credit history should be just about perfect.

What's you incoming and outgoings? Was this a single or joint mortgage application?

Not really sure what to do now - the Halifax guy said that even if it is a mistake by Experian I would need to wait 3 months to re-apply so their system could update. There is no human it can be escalated to in Halifax once the system has said no either. Bonkers.

Questions above

System

!!! wrote: »

Questions above

You say this often but you've yet to explain why people with 999 scores are declined for loans, credit cards and even mobile phone contracts.

sartois

Thanks for the responses.

Just to clarify a few points:

1. My incomings/outgoings did not affect my application. I have a good salary and I did not fail on the affordability test. Other than a mortgage and the usual utility bills I have no outgoings. The total amount of the mortgage would be 2.4 times my salary including clearing the Help to buy.
2. I have 3 credit cards with zero balances that I use for airmiles, payment protection etc. The available credit is £26,000. These are paid off in full every month when used.
3. I was also under the impression Halifax used their own internal scoring. I was surprised when he said he was doing a credit score check with Experian. I clarified it several times (after it failed) and the mortgage advisor was very clear on the fact they use Experian for the credit score check. Yes they do not use a 'score' but it comes back on his screen as a pass or fail. Unless there is a Halifax version of Experian and a consumer version of Experian with different credit histories then I believe we were both looking at the same system. Mine said 976 and Excellent, his version said Fail and he said he could get no further details and all I could do was ask Experian for the details. Since they give me a 'score' of 976 then this at least suggests to me there are no black marks otherwise my made up 'score' would probably be a lower made up score... wouldn't it?

Anyway I am baffled. This is what ClearScore says I am doing well:

You don't have any court judgements, bankruptcies or Individual Voluntary Arrangements
You have no accounts in default or repossession
You've been on the electoral roll at your current address for a long time
You've made very few applications for credit in the past year
You have held at least one of your accounts for several years
Very few/none of your accounts have overdue payments
Your largest credit card limit is relatively high
You have stayed within your credit card limit in the past year
You're using a small amount of your total credit card limit (below 50%)
Very few/none of your secured loans or mortgages have overdue payments
Your current Telecoms balance is relatively low

This is what they say on the 'things to improve':

No factors available

...and yet the only thing my mortgage application failed on was the credit score check

Pixie5740

ClearScore shows your credit history as held by Equifax. You say in your OP that Halfax used your Experian credit history as part of the application process so what does your Experian credit history, note that's history (the thing lenders use in their own algorithms) not the 976 marketing tool Experian call your credit score.

[Deleted User]

sartois wrote: »

Since they give me a 'score' of 976 then this at least suggests to me there are no black marks otherwise my made up 'score' would probably be a lower made up score... wouldn't it?

In a world where Experian give 18 year olds and bankrupts a score of 999 - no.

sartois

Pixie5740 wrote: »

ClearScore shows your credit history as held by Equifax. You say in your OP that Halfax used your Experian credit history as part of the application process so what does your Experian credit history, note that's history (the thing lenders use in their own algorithms) not the 976 marketing tool Experian call your credit score.

Thanks, but isn't my credit history the same on whatever system? I don't have access to my Experian full report (yet) but I presume that even in marketing scores if I had defaults etc my score would be lower. The reason for listing the ClearScore items is just to show that in theory at least my credit history should be acceptable without basing it on a score.

[Deleted User]

Your history will differ on the various CRAs, as not all lenders report to all CRAs.

Not to mention the possibility of errors on each.