AIP Decline

FLB2796

In December me and my partner applied for a remortgage with Halifax that passed a soft and hard credit check with no problem. We didn’t go ahead with the remortgage because our property wasn’t valued enough.

We’re now in the process of buying an inherited property our LTV will be 75% this will be borrowing enough to pay off our existing debt, have money to carry out a renovation and pay family off for their part of the property.

Our AIP was declined 4 weeks ago we assumed this was because my partner had an old default with Vodafone. We managed to get that removed and that’s now cleared off of his credit report. Our broker did another AIP which was declined again. Since reviewing what’s different between now and December. I had an account with NEXT with no balance but a credit limit of £1500 and an American Express card with £6k and no balance. These both closed earlier this year because I wasn’t using them. The 2 credit cards I have now are both quite near their limit. Is this what’s failing the AIP? My high credit utilisation? I don’t have enough savings to pay these off but if I pay a bit off of both will this help? & how long does it take to reflect on my credit report? 

We’ll have more than enough to pay these off when the mortgage goes through and I’ll NEVER abuse a credit card again but I know you can’t prove that to a lender.

MovingForwards

Without knowing more information, there's little anyone can advise.

What's the current balances on the CCs you are using and what's the limit?
How old are you / your partner?
What's your / your partner's income?
Are you employed / self-employed?
What line of work are you in?
If self-employed, have you taken the grant / bounce back loan?
Any children?
If so ages?
How much are you trying to borrow?
How much of that is to pay debt / buy out family?
Have you checked all credit reports? (Free from MSE credit club, Clearscore, Credit Karma)
How much are your savings?
What are your plans with the existing property and inherited property? Eg sell, rent etc.

FLB2796

Tescos limit £5700, balance was £5200 at time of AIP now £4000.
 B’Card £13300 balance £12800, I’ve got £3k savings I could use to pay some off of thisAs I originally said I did have other available credit that’s now been closed.

We’re both 30, I’m employed part time £16k with 2 dependants (4&2) - no childcare fees.
My partner is self employed but paid CIS so Halifax take last 3 months as an average. Works out £53k annum, he had a self employment grant in May, so last 3 months pay haven’t been affected.

The inherited property is worth £450k we’re buying it for £300k and we’ll be living in it.
We’ve sold our property and we’ll have an equity of £53k. 

Our debt is £35k
We’re looking to borrow £330k that will pay off every penny of debt, fees and just over £30k for renovation works. 

Our credit reports are fine, the only issue was my partners default but we’ve now had that removed.

Thank you for your support 

MaryNB

With a combined income of £69k, a mortgage of £330k is a bit of a stretch at 4.78x salary. Halifax mortgages usually max out at 4.75x. With an income above £50k and an LTV of 75% or less they might stretch to 5x salary but not if they're worried about your financial history.

That's a fair bit of credit card debt that could count against you and yes, a very hight credit utilisation. What is that £35k debt figure made up of? 
Where's the 25% deposit coming from?

NatWest with go to 5x salary but are very risk averse. Virgin money might also go to 5x salary.
Have you spoken to a broker? What lenders have you looked at?

FLB2796

Halifax will lend 5x using CIS vouchers, I understand it’s a bit of a stretch but I didn’t see us having any issues because we would be consolidating everything and just having one monthly payment. 

The debt is made up of my CCs, a loan each and car finance. 

Would it help if I paid off some of my credit card balance? 

The 25% is part of the inheritance, we already own that technically. 

We’re with a broker but they’ve only suggested Halifax because of them taking CIS vouchers for the last 3 months. We’re currently with Natwest but they need last 6 months but would be a reduced amount because of coronavirus.
Do you know any other lenders who accept CIS?