ftb -prepping for mortgage with adverse credit issues

milkn2sugars

This my first post, any thoughts and suggestions would be much appreciated.

My hubby and i have been renting the same property for approx 4 yrs now. He is 30 yrs old and earning a steady £30k, and i am 29 yrs old and earning £16k. We have 2 kids and third (and final!) on the way.

We will be looking to buy our first home next year and have saved up approx £20k so far. Hopefully this will be closer to £30k by the time we are ready to buy. Our problem is that as a consequence of some financial difficulties, my husband managed to miss some cc payments in 2007 and accrued 3 defaults in 2007. After some tough saving, we have managed to clear the debts and the defaults are now settled.

The next step is to build up our savings, improve our credit and hope for the best.

I dont know whether we will have any hope of buying a home whilst the defaults are still on my husbands credit report next year, or if it is better to wait until they have dropped off. Does this seem like a realistic timescale/plan, or is it best to wait it out? Our current accommodation is getting more cramped by the second....

andrewmp

Best to speak to a decent whole of the market broker and tell him your circumstances really. They'll have a good idea of the best lenders for your circumstances etc.

_Andy_

How much were the defaults for?

milkn2sugars

a lot. In total £20k. I feel sick just typing that figure, especially as its not my debt but i am 'married' to it so to speak. These were debts from uni that just got out of control. My husband has seen the error of his ways, now earns a decent salary that we have managed to pay it off and just want to get past it now... i can see how it looks to banks though.........

happybroker

As things stand today you will need a minimum of 20% deposit as Platform funding have a "prime" range which ignores defaults over 3 years old.

Anything less than this and you will struggle, even with the smaller building societies that have a real person that understands to review the application.

Where we will be in a year's time is open to debate but personally I don't see it being too much better....sorry if that's not what you want to hear, better that you get a straight answer though.

milkn2sugars

Thank you, i appreciate the straight talking. As long as there is some hope and something to aim for. I would be happier saving a larger deposit anyway, hopefully lower repayments and more options. Plus kids will be older, and hopefully less likely to feel the urge to deface my future dream house....

Pammy

This is going to be really difficult but not impossible but borderline impossible.

I found it really difficult to get a mortgage and my defaults were for less than £500 from 5 years ago. I have a good wage, partner also but its been a painful experience. Even with a 25% deposit.

Sorry but I don't hold out much hope unless the market changes, otherwise you are looking at 2013 when the defaults drop off.

My friend is in a similar position, and has spoken to upteen brokers. If you go down the route of applying find a broker who knows what they are doing and has experience of bad credit situations.

herbiesjp

The OP will definitely be struggling, however Pammy you should definitely be able to find something.

kaostheory

Sorry to hijack but concerning defaults how long do they stay on your file and is that from date of default or satisfied?

luckyfool

6yrs, and from the date of the default.

kaostheory

Pants!!! Only 5 years left renting then....