Halifax says NO mortgage if SEISS taken

bcopie

K_S said:

@bcopie Sorry your post isn't very clear - is this a broker or a Halifax advisor? And what does furlough have to do with the case?

Hi sorry for the late reply, have been very hectic.

This is the Halifax advisor.
SEISS is what the Halifax say is the self-employed equivalent of furlough, so in their eyes the same thing.

bcopie

Deleted_User said:

Seiss and furlough are factually 2 different things.  1 is for self employed people, the other is for employed people.   
The fact that some banks choose to apply the same or similar policy to both cases may be true. 
Halifax are not one of those lenders though 

I am aware that Furlough and SEISS are two different things.

Sorry but with all due respect my experience shows that the Halifax is one of those lenders.

bcopie

Deleted_User said:

SEISS and Furlough are 2 different things. In my experience Halifax dont lend to furlough but are fine if you have used SEISS in the past

I'm guessing this has now changed, in my conversation with them they are classing them as the same thing.

bcopie

Nervouslywaiting said:

Friends of ours have just been accepted by Halifax and he has claimed 2 of the SEISS grants.

Have your friends told them that they took them though, I wasn't asked. My Ex was, from a different advisor. That's how we found out. If it is an AIP they have you might want to ask them to check because the underwriters may just knock it back.

bcopie

Just as a follow up on this.

We've been told that one of us can actually port the existing mortgage (its twice the amount and monthly payments are x3 more than a new mortgage would be. This is clearly insane, I was under the impression that banks couldn't trap customers like that or did I misread that (quite possible tbf).

csgohan4

bcopie said:

Just as a follow up on this.

We've been told that one of us can actually port the existing mortgage (its twice the amount and monthly payments are x3 more than a new mortgage would be. This is clearly insane, I was under the impression that banks couldn't trap customers like that or did I misread that (quite possible tbf).

Banks are now constrained by regulation more than they did 13 years ago. They have to ensure affordability of the borrower and stress test their income by current rates +5+% at least.

You must understand also that lower interest rates are for those who are lower risk i.e low LTV. The higher LTV's incurs higher interest as they are deemed higher risk and statistically more at risk of Repo which the costs are not insignificant. 

mortgage prisoners are unfortunate and I understand Martin Lewis is campaigning to get them in a better place.

But the bottom line is, if you cannot show you can borrow x4.5 of your gross income before debts, you generally won't be able to borrow due to the current regulations.

The 2008 recession was also due in part to the sub prime lending which got out of hand as well, people were getting 125% mortgages like candy back then. How could they afford it?

bcopie

csgohan4 said:

bcopie said:

Just as a follow up on this.

We've been told that one of us can actually port the existing mortgage (its twice the amount and monthly payments are x3 more than a new mortgage would be. This is clearly insane, I was under the impression that banks couldn't trap customers like that or did I misread that (quite possible tbf).

Banks are now constrained by regulation more than they did 13 years ago. They have to ensure affordability of the borrower and stress test their income by current rates +5+% at least.

You must understand also that lower interest rates are for those who are lower risk i.e low LTV. The higher LTV's incurs higher interest as they are deemed higher risk and statistically more at risk of Repo which the costs are not insignificant. 

mortgage prisoners are unfortunate and I understand Martin Lewis is campaigning to get them in a better place.

But the bottom line is, if you cannot show you can borrow x4.5 of your gross income before debts, you generally won't be able to borrow due to the current regulations.

The 2008 recession was also due in part to the sub prime lending which got out of hand as well, people were getting 125% mortgages like candy back then. How could they afford it?

Hi, thanks, but not entirely sure how that applies to our situation. Both myself and my Ex would have ltv of 50% at least if not substantially more. We are only looking to borrow about x2.5 of our income. Yes our income was lower because of Covid and we took the SEISS to help cover this. Covid is now pretty much over and out income is increasing again without the SEISS, our shop is now open (during Covid it was closed). We have 10 years of income to show what previous income was like.

dunstonh

Sorry but with all due respect my experience shows that the Halifax is one of those lenders.

No it's not. Your experience is with Halifax via an in-house member of staff.    It will not necessarily be the same as the experience with Halifax via a broker.   Lending decisions can vary with different distribution channels.  

We've been told that one of us can actually port the existing mortgage (its twice the amount and monthly payments are x3 more than a new mortgage would be. This is clearly insane, I was under the impression that banks couldn't trap customers like that or did I misread that (quite possible tbf).

That risk is already on the books and finance in place to cover it.    A new lending decision is based current FCA regulations and lending criteria in place now.    It makes sense commercially even if it doesn't logically.

[Deleted User]

bcopie said:

Deleted_User said:

SEISS and Furlough are 2 different things. In my experience Halifax dont lend to furlough but are fine if you have used SEISS in the past

I'm guessing this has now changed, in my conversation with them they are classing them as the same thing.

Halifax has a clear written policy on furlough.  As long as client is back to work and furlough pay doesn't show on payslips they will take the income as normal. They wont even question how long furlough was for, or anything around the likelihood of being furloughed again. They see the payslip, they take the income. Simples.

Aa far as self employed is concerned they are less clear. However they are widely regarded in the broker industry as rhe easiest lender to deal with as self employed.  In my multiple, multiple applications submitted they dont care about seiss payments taken. They will take income off the sa302 and occasionally ask for bank statements tp confirm business is trading normally.  A lot of cases they haven't even asked for those.

Halifax direct and halifax intermediaries have long had different underwriting pathways. Since increased regulation came in and they shoved most of the longstanding advisors out the door they have more and more limited the scope of what a branch 'advisor' can do.



Re the porting, its your decision to sell so you arent being trapped by the bank. Mortgage prisoners are people who have a good repayment history and want to do a like for like remortgage to a better lender as theirs isn't trading anymore. For whatever reason they dont qualify under normal underwriting so the regulator allows flexibility.  Completely different situation 

Jen271626

Why don't you just approach a broker?