13:58 PM, 28th April 2020, About A year ago 7
I had an Agreement in Principle (AIP) for a Client declined by Paragon yesterday due to credit issues, BUT the credit file is more or less a perfect score, no missed payments, long historical residency, no CCJ’s etc etc i.e. no adverse.
I spoke with Paragon about this and we couldn’t work out what the problem was. Paragon is coming back to me (hopefully) with some clarification.
However, during the conversation with my Client, I was telling them all the reasons why an AIP is usually declined and they didn’t fit any of those reasons…. until I suggested as an off-the-cuff remark, that some people are rushing in to the Covid-19 payment holiday arrangement, and they then said that yes, they had called all of their lenders (resi and BTL’s) and taken a payment holiday on all of them.
We know that credit reference agencies are not being updated with these payment holidays as an adverse entry, but it does make you wonder if there is a behind the scenes record, and/or if the lenders are sharing this data between themselves to protect the banking industry.
I told them (as I am telling everyone) it is not a holiday to enjoy at leisure, it is seen as, and deemed to be, a declaration to the lender that the borrower has very quickly fallen in to financial hardship and they are formally asking for a deferred payment because they are implying that they can’t afford the payments due to no back up plan i.e. no savings or other financial resources to continue to meet their obligations.
If you were a lender, how else would you be looking at this request not to pay?
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