Halifax Declined Remortgage due to credit check?! - HELP!

kookamunga

My husband and I bought our flat in January and we knew there would be refurbishment work required but we didn't know how much. Now that we've sunk our teeth into it, we've realized there's a lot more work required than we had anticipated so we waited 6 months to be able to remortgage and I called Halifax this morning to submit the application and it was rejected because of the credit check! I asked for more information but the mortgage advisor said she only received a "rejected" message and no further info. The thing is, both mine and my husband's credit is stellar. The ONLY thing I can think of is that they rejected it due to having high unutilized credit on my credit cards (I have £19,050 between 4 cards, and I only use one card which I spend a few hundred a month on and pay it off each month).

1. Is my high unutilized credit the reason we were rejected from our mortgage application? Or is it something else?
2. If it is due to my high unutilized credit, what should I do? Closeout the cards I don't use and apply again next month once the credit score refreshes? I'm happy to do whatever I need to do to get the remortgage!

The irony is that we put down a 20% deposit when we bought in January thinking we wouldn't need the money and I really should have done a 15% mortgage and used the rest for refurbishing! We can't move to another mortgage provider since we already started some works and I'm afraid if we get a new valuation the property would be valued at less! So we need to get the remortgage through Halifax.

EDIT: I just spoke to L&C and they said that Halifax is one of the most liberal lenders so if they won't lend to me then it's highly unlikely anyone else will.

I also just spoke to a company that helps with finance on renovations and they said everyone is being cautious because of the UK's economic conditions (I'm assuming uncertainty with Brexit?) Could that be it too?

stu2500

In my opinion that wouldn't have an effect on the decision, I have the same and had no issue with Natwest.

You would need to check both credit files for errors/mistakes, make sure electoral role is correct etc. If it is purely for credit history, there must be something on either credit history that is causing the issue. Use a free credit file check like Noddle, clear score etc, don't pay for one.

Carrot007

kookamunga wrote: »

The thing is, both mine and my husband's credit is stellar.

You may think so, what credit do you have (beyond the mortage), having none is often a bad point in lenders eyes. (does your cerdit report(s) ever show a balance on things? a zero on credit cards is not showing you in a good light (to them).


(add random point people like around here that your score on the 3 means nothing).


Get your three reports and see what is on them. USE THE SAME DETAILS AS THE BANK WAS GIVEN. This is important as slight changes can mean a different report. (The bank often populates an address from a database, check it is right etc.).


20K available on cards is nothing so it is not that. If it was they can request you close cards (which I have never seen, maybe pay it off as a requirement yes, but close never).

Let_Us_See

They have a current mortgage which possibly equates to the largest credit commitment they will ever hold. Therefore, no need to worry about under utilisation of credit cards.

kingstreet

So you are approaching your existing lender for a further advance? A remortgage is a new mortgage with a new lender to repay the existing mortgage and where required, to borrow more.

You had an address change just six months ago and took on a new commitment. It's possible the credit system is still showing out of date information and it might have been better to wait for a little while, rather than trying at (eg) 12:01 on day 181.

You could also consider a second charge loan with another provider with no early repayment penalties and then remortgage this and Halifax when the ERC ends.

[Deleted User]

GDPR might help you here. You have the right to have any decision made by computer about you reviewed and explained. So if it's just "computer said declined" you can ask them to explain exactly why and have a human review it.

Carrot007

DELETED USER wrote:

GDPR might help you here. You have the right to have any decision made by computer about you reviewed and explained. So if it's just "computer said declined" you can ask them to explain exactly why and have a human review it.

Of whioch the answer can still be "Not telling you due to commercial concerns." And likely will be.

[Deleted User]

DELETED USER wrote:

GDPR might help you here. You have the right to have any decision made by computer about you reviewed and explained. So if it's just "computer said declined" you can ask them to explain exactly why and have a human review it.

No - GDPR is different from commercially sensitive lending information.

They have request a manual review, sure, but they are still not obliged to give the reason for declining even following manual intervention.

kookamunga

kingstreet wrote: »

So you are approaching your existing lender for a further advance? A remortgage is a new mortgage with a new lender to repay the existing mortgage and where required, to borrow more.

You had an address change just six months ago and took on a new commitment. It's possible the credit system is still showing out of date information and it might have been better to wait for a little while, rather than trying at (eg) 12:01 on day 181.

You could also consider a second charge loan with another provider with no early repayment penalties and then remortgage this and Halifax when the ERC ends.

Yes, that's correct, I'm asking to borrow more from my existing lender. It seems crazy that they were willing to give me a 15% mortgage before and now won't give me my own money back, right?!

How long should I wait before applying again?

[Deleted User]

Are L&C the only broker you have spoken to?
The thing about Halifax being lenient is true but that is to do with actual defaults and bankruptcies etc. It might just be that they have a higher overall score requirement in this case.

You need someone to actually look at the reports and make a judgement. I had a case with Halifax ask for a 35% deposit, moved it to Natwest and they did it at 5% deposit.
A case with Santander declines, offers with TSB
Halifax declined another on credit score and HSBC offered it (still dont know how that one happened)

Someone needs to do aome legwork here and help you. L&C are notorious for being fairly lazy and what you have been told is another example of it

kingstreet

You borrowed 80% six months ago.

What LTV are you trying to get to now and are you using a realistic estimated value, as the max is 85%?