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  • FIRST POST
    • Natski
    • By Natski 17th Mar 17, 9:20 AM
    • 13Posts
    • 3Thanks
    Natski
    Best approach to getting a mortgage with past bad debts and ccj
    • #1
    • 17th Mar 17, 9:20 AM
    Best approach to getting a mortgage with past bad debts and ccj 17th Mar 17 at 9:20 AM
    Hello everyone,
    It's a long time since I've posted on here but recall getting some much needed help and support a few years back when I was really struggling, so hoping someone might be able to advise again.
    So in 2005 I bought a shared ownership property in south London, and then 3 months later found myself made redundant. I found work quite quickly, but unfortunately at a lower salary (about £5k less per year) and gradually started to mount up debt. Being fairly young at the time (23), I didn't manage this very well, and ended up with a CCJ for £700 in 2012, plus about 5 defaults with various companies including HSBC (remember the unfair charges scandal?!), and a pay day loan company. I also had additonal payday loans but these didn't default. After spending much time on this site, I started to sort things out, and made payment arrangements for minimal amounts to clear the debts. In totalnI owed about £10k, which, considering my salary at the time, was huge.

    Since about 2010, my financial situation started to improve as I progressed in my career, and I've been fortunate enough to see my income gradually increase to £45k, which I've been earning for the last 2 years. I've also come into a small amount of inheritance and last year sold my flat for a small profit. This has allowed me to clear the majority of my debts, starting with the CCJ, which I cleared in July 2016. I still have a couple of debts outstanding but I have the money to clear these and will be doing this asap. I also now have almost 2 years worth of payments on my credit record which have been made on time, including for my mortgage (before I sold last year), which I previously had problems paying (but managed to get a default removed after complaining to the Ombudsman as Halifax had systematically refused to acknowledge any of my offers to clear the arrears).

    I now live with my partner in his flat, and we want to buy a house. He has about £200k equity in his flat, and between us we have an income of approx £85k. However, because of my past history, I'm worried that my credit status will make it really hard for us to get a good mortgage (or get one at all) and I feel guilty because that also then will impact on my partner.

    Does anyone have any idea how lenders would view my history if we applied for a mortgage together? Property prices are about £600k (at the cheap end) in our local area and we'd like to stay here if possible. We would use the equity as deposit, so think we would be able to comfortably cover repayments on £400k mortgage, depending on the interest rate. I know the fact that I have so many defaults and the CCJ is quite bad, but they are all between 4 - 5 years old, some will fall off early next year, and I think one will fall off in May this year. Also, how would my bad credit affect my partner in terms of us applying for the loan together? Will his record be affected even though the debts are mine? He has a very strong credit history, no late payments or other issues.

    Sorry for writing a short novel but wanted to explain the context of my query. I know for many it will seem like I have nothing to worry about compared to the ongoing debt problems some are still facing, but I have been there and had some very dark days, and have been fortunate enough to haul myself out after many years of slogging away. Any help with my query would be really appreciated, thanks.
Page 1
    • ACG
    • By ACG 17th Mar 17, 9:42 AM
    • 15,394 Posts
    • 7,784 Thanks
    ACG
    • #2
    • 17th Mar 17, 9:42 AM
    • #2
    • 17th Mar 17, 9:42 AM
    Everything seems quite historic and you have a cracking deposit.

    I think there will be options for you at noramal/near normal rates. It really depends on how everything appears on your credit report. But I would say based on what you have said you do not need to wrry about getting a Mortgage.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • Natski
    • By Natski 17th Mar 17, 10:09 AM
    • 13 Posts
    • 3 Thanks
    Natski
    • #3
    • 17th Mar 17, 10:09 AM
    • #3
    • 17th Mar 17, 10:09 AM
    Everything seems quite historic and you have a cracking deposit.

    I think there will be options for you at noramal/near normal rates. It really depends on how everything appears on your credit report. But I would say based on what you have said you do not need to wrry about getting a Mortgage.
    Originally posted by ACG

    Wow, thank you for the super quick reply! That has made me feel better So do you think it would be best for us to go to a broker, just in case, or could we possibly try going direct to Lloyds (who my partner has his current mortgage with)? One of my old debts (overdraft) was with Lloyds, but has since been cleared. I don't remember if this one was in default or not, would have to check credit report.
    • ACG
    • By ACG 17th Mar 17, 10:19 AM
    • 15,394 Posts
    • 7,784 Thanks
    ACG
    • #4
    • 17th Mar 17, 10:19 AM
    • #4
    • 17th Mar 17, 10:19 AM
    I think it depends on your credit reports. If everything (including the pay day loans) is that old it has dropped off then you may be fine doing it yourself.

    If there is anything on there then I think it would be a good idea to use a broker with experience in adverse. The crdit scores on your credit report are worthless, however lenders do credit score you. So if you get it wrong and have negative markers on your credi report you are potentially doing a lot of damage.

    I do not really know a lot about Lloyds criteria so would not like to comment on them. Some lenders particularly RBS/Natwest are lenders that will hold a grudge with defaults. Lloyds may be similar, but I am not sure.
    Last edited by ACG; 17-03-2017 at 10:23 AM.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • Natski
    • By Natski 17th Mar 17, 10:25 AM
    • 13 Posts
    • 3 Thanks
    Natski
    • #5
    • 17th Mar 17, 10:25 AM
    • #5
    • 17th Mar 17, 10:25 AM
    I think it depends on your credit reports. If everything (including the pay day loans) is that old it has dropped off then you may be fine doing it yourself.

    If there is anything on there then I think it would be a good idea to use a broker with experience in adverse. The crdit scores on your credit report are worthless, however lenders do credit score you. So if you get it wrong and have negative markers on your credi report you are potentially doing a lot of damage.

    I do not really know a lot about Lloyds criteria so would not like to comment on them. Some lenders particularly RBS/Natwest are lenders that will hold a grudge with defaults. Lloyds may be similar, but I am not sure.
    Originally posted by ACG

    Ok thank you, yes some will still be on there as they won;t drop off until next year so we will go with a broker to be on the safe side. Thanks very much for all your help
    • ap1985
    • By ap1985 17th Mar 17, 3:48 PM
    • 297 Posts
    • 128 Thanks
    ap1985
    • #6
    • 17th Mar 17, 3:48 PM
    • #6
    • 17th Mar 17, 3:48 PM
    I cannot see you having any issues in obtaining a mortgage. I was in a similar situation to you 7 years ago and managed to clear off my debt and get a mortgage with a lower deposit then what you have. Good luck and hope it all works out for you.
    Finally going to be a homeowner
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