Halifax has apologised after rejecting a mortgage application from a homeowner who is hosting Ukrainian refugees. Dominik Zaum and his family have housed a mother and her young daughter in an annexe since June 2022 under the Homes for Ukraine scheme.
When his fixed-rate mortgage came up for renewal, Zaum applied to Halifax but was turned down. He said the bank told him there was a 'significant risk' he might rent out the annexe commercially in the future. 'We've never rented it out, we're not renting it out now, and we have no intention of doing so,' he told BBC Radio 4's Money Box.
Halifax initially declined the application after a valuer's report noted the annexe was unsuitable for lending purposes and gave it a zero valuation. Zaum said he raised the issue twice through his mortgage broker without success. Only after Money Box began investigating did Halifax reverse its decision.
The bank said in a statement: 'We are very sorry for the confusion. We are very supportive of the Homes for Ukraine scheme and would not decline a mortgage application on this basis.' It confirmed that after reviewing the application again, an offer has been issued.
Zaum said he worried that other lenders might react similarly, but he has since secured a mortgage elsewhere. Had he been unable to do so, moving to a standard variable rate would have cost him an extra £9,000 a year.
