Bad Credit: Parent Guarantor??

lookingup_2

Hi Guys,

I am new to this forum and desperately seeking some advice. From reading the posts on here you seem like a friendly bunch!!

I am currently looking at buying a house. I already own one which I let out and I am hoping to buy one for me to live in. I was made redundant a few months ago and so I missed some payments on credit cards (now have a few defaults) which I am working on sorting out now I'm back in work.

I have always kept on top of mortgage repayments for my current property but I'm aware my credit rating has taken a beating over the last few months and will currently be poor as a result. My parents own a house worth approx 400k with no mortgage. They have kindly offered to be guarantors for a mortgage if that will help me.

What I'm wondering is whether this is a possibility? I wouldn't stand a chance of getting one on my own but would things change if my parents are guarantors? (They both have good credit). I would be looking at a house around 180k mark and I could put a small deposit down or about £30k if I were to sell my house at the moment.

Any help will be greatly appreciated...it's all a minefield to me!

_Andy_

A guarantor is only used if income is an issue - it won't affect things at all with your adverse credit.

lookingup_2

yes I understand it won't change things with regards to my credit but I wondered whether having a guarantor with perfect credit and alot of equity would help me to get a mortgage in spite of my credit rating. I assumed that having bad credit meant I am statistically less likely to keep up my repayments - therefore if the lender has my parent's house as security as a back up should I fail to pay they might consider giving me a mortgage.

VIGILANT22

It would make no difference...

inmypocketnottheirs

Trying to get any kind of mortgage at the moment without 100% satisfactory credit history, 15% deposit and PAYE employment history covering 3 years is highly unlikely.

lookingup_2

Thanks for your honesty! Would it make any difference if I was to take out the mortgage with my Dad? Or do they basically always look at the person with the worst credit regardless of any of the joint applicants?

Conrad

Tis like the analogy that you should let Peter Sucliffe mind your kids for the night because his Mum will be there - you still woundn't do it!

I'm afraid the lenders will be 100% guided by your credit rating and will 100% ignore your Dads.

The only option is for them to remortgage thier home in thier names only and give you the money to buy a place cash.

Good luck.

Thrugelmir

Why not just live in your BTL property for a while ?

lookingup_2

Thanks all for your advice. I'm afraid the BTL property I have is in the wrong location for work. Back to the drawing board I guess....

Trollfever

Sell the BTL property to your parents and use the profits to sort out your credit reference files and fund the deposit on a new place.



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