Mortgage application Guidance Please

MissEA

I was wondering if someone could help me. I am a first time buyer and I am using a broker for a help to buy purchase. I am considering finding a new broker for the following reasons. 

My application  was declined by Barclays due to affordability however they did a hard search on my credit file and as a result my credit rating has gone down. I was assured by my broker the the search would leave a soft footprint only but upon further digging it appears a DIP leaves a hard search. My advisor has said they were unaware of this however I think that an advisor should know these things as they deal with these banks on a daily basis. Barclays are refusing to remove the hard search. When the advisor applied to Halifax they declined the AIP based on credit score. I was told the full application had to be submitted but the decision was still a decline. The advisor found out the reasons for the decline was due to previous late payments (a few in early 2018) and one in 2019, and there were unhappy with the balance on my credit card which I have since cleared. I was under the impression that the whole point of using a broker is because the know the market and can find lenders that will more than likely accept your application based on your circumstances? Am I being too harsh or does this kind of thing happen often.  

Slithery

Your credit score is a made up number, it's irrelevant.

[Deleted User]

Slithery said:

Your credit score is a made up number, it's irrelevant.

That is only partially correct and wholly misleading. 

The reduction in the credit score from the agencies is “an indication” that something is, or has gone wrong in the history. 

Ie too many searches, too high use of credit allowance, missed payments etc

Its the first indication that action is needed. To suggest its a made up number with no relevance is incorrect. Its the first indication that something is wrong 

jonnygee2

Given your situation, I think switching brokers isn't a bad idea. They've given you poor advice and been unable to find you a suitable mortgage so far.

MovingForwards

Speak with another broker, if they do not ask for copies of your credit reference agencies reports, details of your financial history, what you want from a mortgage eg fixed interest rate, how you spend your income etc and reasons for the credit blips of your files, find another broker.

Your score / rating is not seen or used by a financial institution as they have their own internal algorithm for scoring applications.

sjc93

We had horrible luck with our broker - I thought it was the best thing to do as I had adverse credit and I was apprehensive about going to the high street and instead he was very slow, and to be honest, wasn't entirely interested in securing the business because we weren't a straight 'forward' case.

However he is right, the DIP/AIP from Barclays shouldn't have left a hard check as it even states on their website that it only does a soft search. I would enquire with Equifax/Experian (wherever the hard check is) and dispute it directly through them.

We did it all ourselves in the end because he had left us in a position where he'd told us to put an offer in on a property and the broker couldn't even get a DIP/AIP from anyone and he was "whole of market". Whole of market but he didn't have access to any of the building society lenders (minus Nationwide) who are known for being more lenient and having more of a manual underwriting approach.

Fast forward to the same day and my partner managed to get a DIP from Yorkshire Building Society, and now we have our mortgage offer and we're at the end of the line (almost at completion).

Honestly, if I were you, I'd take a good look at your file and either look at going to a specialist broker who deals with adversity, or perhaps chatting through with a building society. 

steampowered

It sounds like you are seeking a mortgage at the top of your affordability criteria, with late payments on your credit file from 2018 and 2019.

That's the reason why you are getting rejected. You are always going to have difficulties with that background. It won't be because Barclays did a credit search - that will have very little impact.

A broker can advise you on which lenders are most likely to accept you with recent defaults on your credit, but cannot guarantee you will be accepted.