bad credit remortgage

johannab

Hi, Does anyone know of where to start for a remotgage?

I have no ccj's but I do have defaults (3 current - for credit cards). I have no missed mortgage payments in the last two years.

The property is worth about 160-170k and the outstanding mortgage is 138k. I earn 42k as does my husband (but he has a rental property in his name so lenders may not lend on a joint basis as he already has a mortgage...?)

Any advice ? have put it off until now as I have been thru it all before many years ago and know how hard it is to get sub prime mortgage.

Have things got worse or better recently?

Any help or ideas for starting points are welcome

Jo
ps currently on LIBOR plus 3.5%. Good at the moment but need to remortgage as its currently a 'buy to let' and we shouldnt be living in it with the current mortgage and have a short grace period to get it changed or move back out.

VIGILANT22

Re husband's mortgage if this is a btl, he will have income fom this which can be added to main income (less mortgage payments)...this should not have an impact on his overall affordability for a residential mortgage.

Your defaults are most likely to present a problem...how much are they and how recent.

Who is yr current lender? I ask this as some sub prime lenders are offering incentives for you to move your business elsewhere...

Thrugelmir

Take a long hard look at your finances. Good salaries, 2 properties, rental income. Yet 3 defaults for credit cards.

Sell a property and set up yourselves financially before venturing into business again.

johannab

Hi Thrugelmir,thanks for your response , this wasn't a business venture though, this was two people in their thirties getting married and already having a property each.
The rental property can't be sold as its in negative equity. The property we live in and want to stay in has 20k equity ,is it worth selling it? we would still need to get another property for similar price and the 3 defaults wouldn't go away.
If we sold BOTH we may break even, but again the defaults would remain,we would then need a deposit to start over... Not sure getting off the property ladder in order to start over is the way to go.

VIGILANT22 - thanks for that, I am with GMAC at the moment, any advice on where to go...? The defaults are a few Grand each (3k, 5k 3k) and are from 2007.

Jo

Thrugelmir

johannab wrote: »

Hi Thrugelmir,thanks for your response , this wasn't a business venture though, this was two people in their thirties getting married and already having a property each.
The rental property can't be sold as its in negative equity. The property we live in and want to stay in has 20k equity ,is it worth selling it? we would still need to get another property for similar price and the 3 defaults wouldn't go away.
If we sold BOTH we may break even, but again the defaults would remain,we would then need a deposit to start over... Not sure getting off the property ladder in order to start over is the way to go.

VIGILANT22 - thanks for that, I am with GMAC at the moment, any advice on where to go...? The defaults are a few Grand each (3k, 5k 3k) and are from 2007.

Jo

Does the rental property generate an after tax profit? Is the mortgage interest only?

What basis is the mortgage of the property you currently reside in?

johannab

hi,Yes at the moment there is a monthly profit as the interest rate is lower. The mortgage itself is interest only at the moment .
The property we live in is on a 'buy to let' interest only at the moment and that is why we need to remortgage . Basically,we used to rent this out but now want to live in it and vice versa. Living in this one saves hundreds a month in commuting petrol.
I don't really know where to start in searching for a mortgage.
Thanks,Jo

VIGILANT22

JO...Have you been informed if GMAC still hold yr mortgage?

Conrad

jo - a couple of lenders can consider this case at 85% maximum ltv. They will scour your last 3 months bank statements and will of course expect you to have cleared those 'bad debts' when they defaulted, or at least have fully caught up with where you should have been in terms of full repayment of any arrears, promptly.

If the case makes sense and a mortgage is viewed as sustainable and the lending passes the 'responsible lending' test, you have a chance. Rates from about 3.7%.


Remember your bank statments must be good - no lates, no missed, no dishonoured direct debtis, within od limits, salaries mandated to the account and so on.

The other mortgage needs to be fairly well covered by the rent.

There must be a clear address history and no discrepencies 9as there sometimes are with a second property case).

Good luck

johannab

Hi, yes its still with GMAC. All the letters are still in their letterhead and I remember receiving a letter stating that the mortgage remains with them.

Thanks Conrad,yes my statements are in order with no overdrawns or missed payments so on that front I should be ok.

Do you know which lenders I should be looking at ?

Jo

VIGILANT22

Jo.....Last year GMAC-RFC contacted some customers offering to wipe thousands off borrowers’ debts if they could remortgage elsewhere. I suggest you first write to them and ask if they're prepared to offer you a "discount" if you move yr mortgage to another lender......

johannab

Oh wow, I will certainly do that,thanks VIGILANT22. They didn't write to me at the time though,I wonder why not.