Remortgage advice please

kittycatsam

Hi

About three years ago after having credit problems etc my partner and I took a mortgage with Kensington. The rate is awful and we now pay £729p/m on a balance of £72k. We have a 4k penalty on remortgaging but this runs out in 3 months.

We where given two CCJ's from Yorkshire water a couple of years ago which where settled within a couple of months so have these satisfied CCJ's showing on file. Plus a couple of settled defaults. I've checeked our credit files and everything has shown as being steady and paying for the past year and a half.

All we have on credit currently is the mortgage and a small balance each on a credit card of about £500 which we could have paid off but have made above minimum paymenst each month to show a 'paid on time' mark each month. Other than that just bank accounts showing on our files.

The house was vauled at 125k about a year ago but obviously with values going down I'm working on the assumption it'd be about 110k now to be on the safe side. Therefore almost 40k equity in it still.

With the past credit history what is the lieklihood of getting a much better rate elsewhere. Our joint incomes are about 38k per annum.

Thanks

Toughluck

As I mention many times, Abbey will, on 90% of adverse cases, do deals where the LTV is under 75%. The fact that the CCJ's are satisfied and if the defaults are 2 years or older I would approach a broker and try it there (as opposed through them direct or a branch network). As long as the income is more than enouigh to fit their lending policy, they will judge it on the whole case (unlike N Rock who declined one of mine with a £10 default)!!!

jill2002

Sorry toughluck, I disagree. By doing the application through the branch network the customer would generally get an INSTANT decision - through the broker network it would only be a provisional acceptance.

grogdog

i think it depends on your relationship with the lender and the process team involved, i think this is something abbey would be interested in , but as already mentioned they dont want anything over 75/80%ltv

Leon_W

I would agree with Toughluck (sorry Jill !). For cases like this Abbey are usually very good but I would definately go down the experienced broker route with it. They usually have a point of contact to discuss it with first and then can make a judgement on a credit check. Alternatively.

You'll go into an Abbey branch (God help you) and meet with a spotty wannabee in a pink shirt who's fact find IS the credit check ! And as we know, the more checks the lower the score. A broker could probably prevent this.

Regards

jill2002

Sorry Leon, You've obviously not been into a branch recently - we wear white shirts !!! and blouses !!!! The credit check is done whilst we watch the screen - in fact all information from Experian is detailed in front of your eyes. INSTANT decision made.

Leon_W

Write out 2000 times.

I must not stereotype !

Seriously though Jill, these cases would still have to go to an underwriter would't they ?

Regards

jill2002

No, 90% are given an instant decision - it makes life sooooo easy.

Leon, I suppose it's like policemen, when you think they look younger and younger - it generally doesn't mean they ARE younger, just that WE are getting older :doh::rotfl:

getmore4less

First thing I would do is pay off the credit cards, and just rotate some payments through them paid off in full each month, one lot of petrol/shopping will do.

Next do a budget/Statement of affairs(SOA) which shows your income and outgoings, and what you can afford, helps to show regular savings if you can. If you can also show how you can live on just one income.

DO a "what if" SOA based on a typical repayment mortgage with a slightly higher rate than lenders are currently offereing to show the increased savings.

Always have this handy(multiple copies), it is a while since I have done a mortgage but they often ask for this info so having in a well laid out form you can just attach to any application and if it goes to an undewriter it looks very good.

Your are looking for under 70% LTV at 2* joint which is on your side.

I recommend(asuming you have a good record with them) is the bank you use, they know you spend patterns the best and can see that any SOA is true reflection, most banks have something competative these days, might not be the absolutely best deal but that is not what you are looking for

I found that other lenders used to be a lot more willing to consider an application if you allready had one approved and were just looking for a better deal.

At this stage you are just looking for the lender to consider you so watch out for up front fees. decide on the exact deal/rate/product later if you can.

Toughluck

Jill

Do you work for thw Abbey, I am interested as I would like to know if someone with adverse and a low LTV, is the scoring system identical to what we use on the introducers web-site? ie when CCJ's or defaults are declared on DIP is any different through the branch network?

Have to admit there is a business support unit 3 miles from my office and they will "help" push things through if they see the case is strong enough.

happybroker

A very good friend of mine works for the abbey as a mortgage advisor and on discussion it would appear that as a broker with a good relationship with my local team I get things through the she wouldn't have a hope in hell of getting through on the "instant decision".

Despite the dual pricing they are a firm who seem to value the broker relationship enough to take a view if it makes for good business. Leeds BS are similar.

To the OP, speaking to a broker will give you access to experience of what lenders will and won't accept and possibly save you any number of searches against your file that you will get by aproaching lenders directly until one accepts you.