Mortgage Offer Conditions

Gem_M90

davidmcn said:

Gem_M90 said:

davidmcn said:

Gem_M90 said:

Does anyone who's experienced this have knowledge of what a lender will accept as evidence of payments being made before completion? Currently I'm being passed about between the broker and solicitor and can't seem to get a definitive answer. 
As I'll be making repayments until the time of completion, my credit report will still show balances if Halifax run a check on this prior to completion as it won't have updated to reflect the most recent payments.  Therefore, will they accept screenshots of balances being paid etc? I'm assuming from what others have said, Halfax will ask my solicitor to seek evidence of payments and then it will be upto my solicitor to confirm its paid, but he can't seem to tell me what evidence I'll need to show either. 

Like I said above, I very much doubt you'll ever have to produce anything to the Halifax, so I think you're worrying unnecessarily.

However, I only want to be prepared for the scenario that they do indeed run another check before completion and my credit report is yet to update and still shows balances remaining.

But the condition allows you to have the balances remaining before completion, because it doesn't require them to have been settled until completion actually happens. So it would be pointless for the Halifax to check. Which is why they don't.

If they run any further check before completion, it will be to spot new matters on your credit report, not the stuff they already know about.

Ok, thank you. What you're saying is perfectly logical I just didn't want to be caught out if on the day of completion they ask for evidence. I guess in that instance then they'd have to accept screenshots of balances etc as they've allowed me the full timescale to pay it. 
It makes sense, and I'm a pretty logical thinker but I'm treading new ground so I just wanted to ask. Thank you for your insight.

[Deleted User]

They dont need confirmation of this through yourself, your broker, or your solicitor.  Its down to you to what you want to do.  Halifax ignore debts being repaid from their affordability calculations.   Not all lenders do, some take what is showing on the report regardless of intentions.  The only reason Halifax will check post completion is to form their lending policy for the future.   They might notice that only 15% of first time buyersclear debt when they say they will but 80% of homemovers do. So they change their affordability calculations to be harsher to first time buyers with debt.  

There wont be any direct imapct on you if you choose to clear it or not.  

And i cant remember 100% but i think Halifax just has a ;being cleared before completion' tick box.  It doesnt allow an actual amount being cleared to be entered as some lenders do.  So there would be no way of inputting that only half the debt was to be repaid

davidmcn

Gem_M90 said:

davidmcn said:

Gem_M90 said:

davidmcn said:

Gem_M90 said:

Does anyone who's experienced this have knowledge of what a lender will accept as evidence of payments being made before completion? Currently I'm being passed about between the broker and solicitor and can't seem to get a definitive answer. 
As I'll be making repayments until the time of completion, my credit report will still show balances if Halifax run a check on this prior to completion as it won't have updated to reflect the most recent payments.  Therefore, will they accept screenshots of balances being paid etc? I'm assuming from what others have said, Halfax will ask my solicitor to seek evidence of payments and then it will be upto my solicitor to confirm its paid, but he can't seem to tell me what evidence I'll need to show either. 

Like I said above, I very much doubt you'll ever have to produce anything to the Halifax, so I think you're worrying unnecessarily.

However, I only want to be prepared for the scenario that they do indeed run another check before completion and my credit report is yet to update and still shows balances remaining.

But the condition allows you to have the balances remaining before completion, because it doesn't require them to have been settled until completion actually happens. So it would be pointless for the Halifax to check. Which is why they don't.

If they run any further check before completion, it will be to spot new matters on your credit report, not the stuff they already know about.

I just didn't want to be caught out if on the day of completion they ask for evidence. I guess in that instance then they'd have to accept screenshots of balances etc as they've allowed me the full timescale to pay it.

But even on the day itself, you wouldn't necessarily be able to show anything, as many people would be settling the balances from the proceeds of a sale - which counts as "on" completion even if the transfers don't actually go through until a day or two afterwards. They're just trusting you to deal with it.

Gem_M90

Deleted_User said:

They dont need confirmation of this through yourself, your broker, or your solicitor.  Its down to you to what you want to do.  Halifax ignore debts being repaid from their affordability calculations.   Not all lenders do, some take what is showing on the report regardless of intentions.  The only reason Halifax will check post completion is to form their lending policy for the future.   They might notice that only 15% of first time buyersclear debt when they say they will but 80% of homemovers do. So they change their affordability calculations to be harsher to first time buyers with debt.  

There wont be any direct imapct on you if you choose to clear it or not.  

And i cant remember 100% but i think Halifax just has a ;being cleared before completion' tick box.  It doesnt allow an actual amount being cleared to be entered as some lenders do.  So there would be no way of inputting that only half the debt was to be repaid

That makes sense. My broker did suggest that the application to Halifax lumps everything together as one debt and you simply tick yes or no to being repaid. Because I asked him if he could specify to say which balances would be cleared and he said he could only enter that everything is being repaid on completion. 
To be honest I just wanted a decent insight as the broker I had to use were ones working on behalf of the property builder I'm using and they seem to have got the offer through and then disappeared (I appreciate their current workload) and I had a feeling my solicitor was more or less saying not to worry about it, without actually saying it out loud. 
Thank you for your opinion, it's helpful  

Thrugelmir

To put matters in perspective. What's the estimated balance that will be outstanding when you complete. 

Gem_M90

Thrugelmir said:

To put matters in perspective. What's the estimated balance that will be outstanding when you complete. 

@Thrugelmir    Well, if I were to make nothing more than my usual monthly payments to the balances, the outstanding balance would be approx £500 on a credit card, and approx £2500 across a store card and 2 mail order accounts. 
As I've had to put down a much larger deposit as I'm borrowing very near maximum with Halifax, I was intending using money for furniture etc to clear more/all of the balances and then worry about the furniture after completion. 
However from what you guys are saying I should be able to continue as I normally would anyway with no real impact. 

Gem_M90

Gem_M90 said:

Thrugelmir said:

To put matters in perspective. What's the estimated balance that will be outstanding when you complete. 

Well, if I were to make nothing more than my usual monthly payments to the balances, the outstanding balance would be approx £500 on a credit card, and approx £2500 across a store card and 2 mail order accounts. 
As I've had to put down a much larger deposit as I'm borrowing very near maximum with Halifax, I was intending using money for furniture etc to clear more/all of the balances and then worry about the furniture after completion. 
However from what you guys are saying I should be able to continue as I normally would anyway with no real impact. 

Also I should clarify, the total outstanding balances showing on my credit file at time of application was just over £10k. Of which I've cleared £5500k. (£4500 on my credit file on application was already clear but hadn't updated on report)

martty

I'm in the same situation as you, but I'm not a first time buyer I'm moving home. On my mortgage offer condition it says its your responsibility to ensure these debts are repaid on or before completion. The only debt I have is a credit card with £3500 on it, but has £5500 on my credit file as its not updated yet. So will Halifax check if ive paid off my credit card? and how do I prove it to them as it will be a month later before I get my statement through, or will I be able to complete without paying it off in full? 

Gem_M90

martty said:

I'm in the same situation as you, but I'm not a first time buyer I'm moving home. On my mortgage offer condition it says its your responsibility to ensure these debts are repaid on or before completion. The only debt I have is a credit card with £3500 on it, but has £5500 on my credit file as its not updated yet. So will Halifax check if ive paid off my credit card? and how do I prove it to them as it will be a month later before I get my statement through, or will I be able to complete without paying it off in full? 

Yes this is exactly my point as well, IF they check how do you prove it if you have until the day of completion to pay it. The general consensus seems to be Halifax won't check, purely because it's a pointless task anyway when, 1. They'll already have released the funds anyway, as the condition doesn't prevent them being drawn down, and 2. If you have until the day of completion to pay it ON completion, how can you prove that. It seems like a totally pointless condition from what I'm gathering..  

Gem_M90

So just for anyone else who may read this thread for advice... 
I have spoken with my solicitor again today who has told me the condition "you have declared an intention to repay some or all of your credit commitments before or on completion" is NOT a condition for the mortgage and it will not prevent the funds being drawn down but it is simply that I have a personal commitment to repay my balances. He has said in his career he has never been asked to evidence credit repayments prior to completion.