Royally Stuffed by the credit crunch.

Shakethedisease

Hubby earns 45k a year as a contractor. I earn 25-30k self employed. Want to buy a house at 110k putting 35k down.

No chance. He's a contractor and has been paying german tax (eu law) for 6 months after paying uk tax for his first 6 months out there ( same employer). No-one will touch him, not the leading contractor mortgaging brokers OR the subprimers. According to them no uk tax means no Uk mortgage ever. He has a Uk address, several uk bank accounts, utility bills, on voters role, has mobile phone contracts etc. Is paid in sterling too. To add insult to injury, when asking about a single person's discount on council tax a few months back we were told because he comes home every 2nd weekend that he isn't classed as 'not living here'.:rolleyes: Yet for mortgage purposes he's now non-residential. :mad:

I've only been trading 12 months and have a 3 year old £248 ccj on file I didn't even know about until last month. So £6000+ a month between us and we can't even muster up a 75k mortgage. Boy, the credit crunch has hit eh !!! I wasn't even expecting to be counted in applying much ( though knew the ccj would be a problem as we're finacially associated even if it is small and over 3 years old, march 2006. ). We've no loans or arrears and only a credit card with £70 outstanding.

Rant over. Sorry everyone. Just didn't think we going to be THAT much of a risk to lenders on circa 70k joint incomes.. even if they were not 9 to 5 usual jobs.

* sigh * guess we'll have to keep on saving then and wait another 2 years till I've got books ???

Has anyone got any suggestions ? We only wanted to buy an ex-council house nothing too ambitious.

opinions4u

So your husband contracts overseas.

You've been self-employed for a year.

You have bad credit.

You want to buy an ex-council house in a falling market.

Yes, the credit crunch has got you. But do you really think you'd have got a mortgage before banks started raising money on the wholesale markets?

You're not exactly a dream proposition for a lender in the good times.

Jonbvn

There are just too many red flags for a lender to agree a loan.

1. Bad credit.
2. One party working overseas.
3. Other party self employed for short period.
4. Ex-Council property.

At the moment, a borrower with one of these issues will struggle to get a loan. With four you have no chance!

michaels

Makes no sense to me though with 25% deposit, where is the risk to the lender even if the borrower defaults surely the collateral will cover the money lent?

herbiesjp

So you would be looking at a £75k mortgage on a property worth £110k

That would be under 70% LTV and is great

The fact you are looking at an ex-council property should not really cause too much problem - plenty lenders accept them assuming the build type is ok


You have a small CCJ - how much was that for and who was it with - this is important in terms of seeing is lenders will "ignore" it or not.

How long has your OH been a contractor? Has he always been in the same line of work?

Income multiples based on your OH sole income are just over 1.5 times income - so good there

There may be some lenders who could look at this - which lenders have you approached already?

unite79

Yep this is placeable, an experienced Broker could do this, there are a few stumbling blocks so your not going to get The best rate in the world - but it is do-able.

Nothing wrong with Ex Council Houses.

herbiesjp

Rates shouldn't be too bad either

Sammy85_2

Dont see how your OH's job can be an issue.

Both myself and my partner work overseas. We dont pay UK tax. We are only in the UK for 5-6months of the year. Our home is in the UK and we have all the usual bills. All the bank required was 3 months pay slips.

I suspect its more to do with your credit history and being self employed.


Regarding your council tax. For him not to be living there, you'd have to move out all his gear! We pay the full years council tax because for the property to be classed as unoccupied the house has to be completely empty.

Shakethedisease

Thanks. Again sorry for the vent, was feeling a bit depressed about the whole thing last night.

The house was ex-council, but a long time ago. It's a 1920's 3 bed, with a huge garden. When I viewed the vendor gave me a copy of the last survey done about 8 weeks ago ( fell through as the other couple haven't sold their house yet )..It was valued at £110k.

Hubby has been contracting for 18 months. The last 12 with the same company his contract is up in Jan, but likely to be renewed.

My ccj is for £248. From Next catalogue. One of those annoying oversights ( moving around lots in the armed forces).. that comes back to bite you on the bum years later ! When I contacted the court it seems it was Moorcroft that took over the debt, and they issued the ccj. I will of course pay it off, but that won't help now. Hubby did have a default, but British Gas wiped that as it was their mistake.

Hubby approached London and Country first. They were confident we'd get a deal through Abbey. I was a bit surprised by that with the ccj. They turned us down. L + C gave up on us.

Last few days has just been phoning around and seeing where we stand. Seems those that are ok with the ccj won't entertain the fact that hubby pays German tax and is a contractor. And those that are ok with the tax situation, won't look at us because of the ccj.

All of them were hopeful that if we got down to 50 or possibly 60 % ltv that we'd be ok and that was subprime. Looks like we'll have to save like mad and hope this house stays on a bit longer.

herbiesjp

You need a true whole of market adviser, and one with experience with these things.

You are right that getting a lender to accept the combination of issues may be a problem, but I am sure you should be able to find a mortgage deal

You really do need the knowledgeof an adviser who deals with non standard cases - as opposed to L&C who deal mainly with mainstream cases

stingrayj

my sympathies it's ridiculous, but stick at it, there are deals out there, just need to get around