Halifax has apologized for rejecting a customer’s mortgage application because the homeowner is hosting two Ukrainian refugees.
Dominik Zaum and his family have been living with a mother and her little daughter in an outbuilding since June 2022.
When his mortgage was due for an extension, he applied for one with Halifax.
But Dominik was turned down after Halifax said there was a risk he could rent the space for commercial purposes in the future.
“We were very surprised because we’ve never rented it, we’re not renting it now… and we have no intention of renting it in the future,” he said.
Dominik has, as he describes it, a small “granny flat” attached to his house. It is a self-contained room with a kitchenette and a small bathroom accessed through a private door.
It is part of the Homes for Ukraine program, launched just over a year ago to provide a home for refugees who fled the country after the Russian invasion in February 2022.
So far, 153,000 Ukrainian refugees have arrived in the UK, according to the government, and research suggests most of them have stayed.
To cover the cost of hosting refugees, hosts will be paid £350 per month for the first 12 months and £500 per month thereafter.
Like millions of other fixed rate mortgage holders in the UK, Dominik’s loan was up for renewal this year, so he decided to look for a new business.
And that’s where the problems – and worries – began.
Halifax sent someone to appraise Dominik’s house.
He said: “We spoke directly to the appraiser beforehand when he came and looked at our house.”
But Dominik said: “When we contacted the Halifax through our agent, they said they could not give us a mortgage because we were providing accommodation to a Ukrainian family and therefore there was a significant risk that we would rent the room commercially in the future . “
Halifax has since apologized for “the confusion” after being contacted by Money Box and has offered Dominik a mortgage deal.
But Dominik claims the only reason Halifax backed down is because Money Box started investigating. “We took on the Halifax twice through our mortgage broker and nothing has changed,” he said.
“It is very unfortunate that it took Money Box to get an answer.”
Halifax said it “deeply regrets the confusion” and strongly supports the Homes for Ukraine program and would not deny a mortgage application on that basis.
“Having re-examined the application, we have now submitted an offer and the application will proceed as usual,” it said.
Halifax said the appraiser did not appreciate the informal nature of the tenancy, and this was reflected in his report, which found the property unsuitable for these lending purposes and received a zero rating.
Dominik said he was concerned Halifax’s refusal may have been echoed by the rest of the credit sector. “We didn’t know at the time whether other banks would have reacted in a similar way,” he said.
“We’ve since taken out a mortgage with another bank, which fortunately hasn’t impacted our finances.”
He added: “Had we not been able to secure a new mortgage we would have switched from a fixed-term mortgage to a higher rate and would have cost us over £9,000 a year.”
The government has advised people hosting refugees under the Homes for Ukraine program to keep all interested parties informed.
Are you part of the Homes for Ukraine program and are you hosting a family or know someone who is, have you had problems like Dominik? Email us your stories at
You can hear more of this story on BBC Radio 4’s Money Box podcast, available shortly after it airs, by clicking on it Here.
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