Heard about the brand new First Time Buyer Pledge? Wondering what it’s all about? Here, we take a look at what Halifax and credit information agency Experian are going to help FTBs to get approved for mortgages.
What is The First Time Buyer Pledge?
Launched on Friday August 19th by Halifax and CreditExpert from Experian, it’s being promoted as a partnership between the two companies to help unsuccessful mortgage applicants to understand why they’ve been rejected.
The pledge also aims to help FTBs pinpoint what they can do to improve their credit rating and boost chances of securing a mortgage offer.
The whole idea behind the partnership is to prevent potential applicants from automatically assuming their current credit score will stop them securing a mortgage in the foreseeable future.
How Does it Work?
The First Time Buyer Pledge is a service that offers applicants who apply for a mortgage and are subsequently turned down the opportunity to take advantage of what is being called ‘CreditExpert membership.’ Basically, this refers to a team of 15 dedicated credit professionals who have been employed to help existing and potential Halifax customers.
The membership is free for 30 days after which a ‘special’ rate will be charged.
The service offers applicants the following:
- Unlimited access to their Experian credit report and credit score
- Advice regarding the factors affecting their score
- Advice on how to improve their credit profile
Stephen Noakes, commercial director, Halifax, commented:
‘Although 8 out of 10 borrowers are successful in getting a mortgage, we don’t want the unsuccessful few to feel like they’ve hit a brick wall if they’re turned down. However, lenders are limited in what we can say about someone’s credit profile, and we know that hasn’t been particularly helpful. By developing this new service with CreditExpert, it means that we can really help first time buyers understand what they need to do in order to come back to us and be successful in their application.’
The First Time Buyer Pledge is designed to bridge the gap between credit information agency and lender.
Until now, it hasn’t been possible for lenders to communicate to applicants exactly why their mortgage applications have been turned down. It could be something as simple as missed credit card payments or even inaccurate and outdated details on credit files. There are all sorts of reasons why mortgage applications are declined.
The pledge aims to make the process less frustrating by opening the channels of communication and potentially helping FTBs take steps towards getting on the property ladder.
Peter Turner, MD of Experian Interactive, stated:
‘This is a great way to help first time buyers get on the housing ladder. CreditExpert membership can help first time buyers by ensuring they have all the support in place to understand how to improve their credit rating so they can make a successful application for a mortgage to buy their dream home. It’s good to be able to help young people with the opportunity to own their own home and we are delighted to be developing this service with Halifax.’