Buying a house from parents 7 worried about bad debt

Mrs_Bumble

Robocod wrote: »

The lawyers bill is from when my parents bought the property, its not a bad debt in any way. It just came through the post this week.

My girlfriends debts are not settled. She still gets letters through from credit agencies.

She was doing a nursing degree and doing occasional shifts with various nursing agencies.

Haven't settled my outstanding Scottish Power and British Gas bills yet as we have spent a fortune decorating the house.

Is taking out the loan a terrible idea?

When I spoke to the mortgage advisor at the bank informally she almost bit my hand off when I told her that we were buying the property from my parents.

She said that we can work it so that we appear to have a 25% deposit and therefore get a better rate.

If I pay these debts off, whow long do you reckon before a lender will go near us?

I am appalled and annoyed!

The adviser at the bank was not giving qualified advise ask, non advised sale!

I am going to be frank because that is how I work!

My daughter is a currently nearly qualified as a nurse and doing her degree, she has worked every hour god sends not to put her in debt above her comfortable bursary.

Think you both need to grow up and understand that debts need to be paid! they are not there as optional expenses you built them up you pay them off!

The loan is a TERRIBLE IDEA!!!!!! Do you get that?????

learn to pay off what you got! Now for the very important part! If you take out a loan it will lower your joint credit score even lower, do you think you can both afford that? plus if you do manage to take out credit it will mean the amount that you are obligated to pay will be deducted from your affordability, plus lower your credit score.

if you get everything square then i think you are not in too bad a position but you have to get yourselves straight. pay everything off and then start again. Speak to your parents!

the person in the bank was not an adviser, a sales person with sales targets and no other objective other than that!

FraudBuster

Robocod wrote: »

I know that the bank who reposessed the house knocked back an offer of £195,000 last year. We were lucky that our friends company were the liquidators and they done us a massive favour by basically only opening the auction to us and telling the bank that they had only received one offer and advising them to accept it.

NHS jobs are very secure, so that is'nt a worry. I'm just gonna have to keep paying the loan to my parents until my credit report is clean.

Its a real pity as interest rates are gonna be higher by the time our ratings get a clean bill of health by the looks of it.

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superfran_uk

As Mrs Bumble says above, you really do need to grow up and improve your attitude towards money if you want to buy a house. Taking more loans is a terrible idea, you can't just go through life taking more and more credit and never paying it off or your house is likely to be repoed. Maybe whoever got shafted by your dodgy deal will be able to afford to buy it back...

As for interest rates, unless you have a massive deposit (a real one, not an imaginary one) and a great credit report you won't get squat at the moment, so a bad interest rate is better than what you can realistically expect. We got a mortgage in June with a 30% deposit and the rate is 5.99% fixed. Hardly amazing, and I have a good credit rating, no debt, and a better salary than you.

DVardysShadow

Robocod wrote: »

...
Myself and my partner have just moved into our new house from a rented flat. The house was recommended to us by a friend as it was going up for auction at a great price due to it being repossessed from a building company who went under.

I initially rejected the idea outright. My partner is still at uni and so we didn't feel we were in a position to take on a mortgage yet.

However, my parents kindly stepped in and took out a loan on the equity in their own house for which they have paid off the mortgage. They bought the house at what was an absolute knock down price of £130,000 (real value approx £195,000). We have been living here since May 1 ...

The problem is that she has several bad debts from about ten years ago, for store cards and council tax (£2000 approx) and has not been able to get any sort of credit whatsoever since we met.

I myself have 2 bad debts to Scottish Power and British gas for £150 and £250 respectively. Although I have been able to obtain credit for a phone contract and a car recently.

We also have a £1500 Lawyers bill to pay . What sort of affect will all this have on our ability to get a mortgage? And if we do manage to get one, will it be at a higher rate?

Also does the fact that we’re purchasing from my parents put us in a better position with deposits etc?

I was thinking of contacting Equifax then taking out a loan (if I can get credit for one) and paying absolutely everything off. Then taking out the mortgage for say £140,000 and paying the loan off.

Less than £4000 in debt and you are talking about taking a loan to pay it off, but you are thinking of taking on a mortgage after a while? This si pocket money, compared to your mortgage.

Sorry, you are so clueless about this that you should not take on a mortgage until you understand why it is sound sense to pay these debts off straight away.

rabialiones

son wants to buy our house, would it be possible to use just one solicitor and transfer property over. just to save paying solicitors fees on both sides.
no mortgage involved on either side?
any advice appreciated

DVardysShadow

Robocod wrote: »

If I was a lender that type of statement would have the alarm bells ringing so loud I'd have a headache!!
Why spend a fortune on something cosmetic when you have outstanding debts that are trashing your credit rating??????

I really mean curtains and flooring and beds. Nothing extravegant

Curtains flooring and beds and you don't pay your gas and electric? Paying your way on £45,000 comes way ahead of curtains flooring and beds. I think your biggest handicap to getting a mortgage is your attitude to money. It is true that lenders would have given you anything you asked for and another £20k on top a while back. But your attitude to paying stinks. I am not saying that to insult you as much as paint the picture that lenders will smell your attitude a mile off.

Before you go any further you need to change your mindset. Once you change your mindset, you will know what you need to do to put your finances straight and things will fall into place

DVardysShadow

Ian_W wrote: »

Wow!! I'd be careful about posting that on a public forum - it's suggesting your friends defrauded the bank!! Whilst you were "lucky" - the poor sap who had the property repo'ed still owes the bank more as a result or if it was a ltd company the creditors probably received less than they should!

Fraud it is. Personally, I hope it is uncovered.