Advice on getting a home mover mortgage with a default on credit file

Jen2girls

Hi i'm new to the forum, but just wondered if somebody could help me out. We are currently looking at moving house. Both my partner and I got copies of our credit reports and I have a default on there going back to 2007. Its for £101 and marked as satisfied. To cut a long story short I used to be an avon rep. I was told that if I didn't place an order for 3 months they would cancel my account. so as I was in the process of moving house I didn't place an order for 3 months. However it turned out that my team leader had placed an order for me that was delivered to my old address that I knew nothing about. I got my forwarded post a number of months later. I called up avon but apparently it was in the small print that team leaders could place orders for their reps. I wasn't getting anywhere with them so i agreed to pay the £101, however I had no idea this had gone through as a default until I checked my file. Will this impact on me getting a mortgage? There are no other blemishes on either mine or my partners file. Thanks in advance for your help

Rico6.9

Defaults are evil. Your existing lender should be able to overlook it. If not or you prefer to change lender it's probably best for your partner to apply for your mortgage. (I suspect your default may even affect his rating and indeed the whole street!) If Avon refuse to remove your default (I understand they're the only ones that can), you'll have to wait until 2013 before your credit file is clear. I've heard mutterings that the "6 year rule" may be reduced to 3 years as we move into line with European legislation in the summer. Even this is too long though. Not being able to buy a house because of an old £100 debt is ludicrous. See if your MP can help improve legislation further. That's what I've been working on these past several years. Hoping for a better MP next month!

Pammy

Yes it will have an impact with some lenders so you need to speak to a whole of the market broker. The fact its satisfied and its under £500.00 will be in your favour.

Pammy

Rico6.9 wrote: »

Defaults are evil. Your existing lender should be able to overlook it. If not or you prefer to change lender it's probably best for your partner to apply for your mortgage. (I suspect your default may even affect his rating and indeed the whole street!) If Avon refuse to remove your default (I understand they're the only ones that can), you'll have to wait until 2013 before your credit file is clear. I've heard mutterings that the "6 year rule" may be reduced to 3 years as we move into line with European legislation in the summer. Even this is too long though. Not being able to buy a house because of an old £100 debt is ludicrous. See if your MP can help improve legislation further. That's what I've been working on these past several years. Hoping for a better MP next month!

That's interesting Rico. I have been having problems for a smal amount from 2005 and its been a really frustrating experience for me.

I didnt realise it was 3 years in other places. What makes you think we will change to 3? If we did I would jump for joy.

herbiesjp

It will depend on the overall scenario as to whether moving home will be possible - not just the default.

However, for such a small amount, a lot of lenders will tend to "ignore" that default.

Rather than applying direct I would suggest discussing with a whole of market adviser, armed with your credit files, so that they can get up to date information from the lenders as to where they stand with their adverse criteria.

Rico6.9

Pammy wrote: »

That's interesting Rico. I have been having problems for a smal amount from 2005 and its been a really frustrating experience for me.

I didnt realise it was 3 years in other places. What makes you think we will change to 3? If we did I would jump for joy.

It was just something I read, probably in the Consumer Action Group Forums. Certainly a step in the right direction but I'll be hassling the next MP to reduce this further.

Pammy

Rico6.9 wrote: »

It was just something I read, probably in the Consumer Action Group Forums. Certainly a step in the right direction but I'll be hassling the next MP to reduce this further.

Why do you think it should be below 3 years? I don't think its the years that is an issue, its the process and the amount.

I think the system needs to alert the lenders to people who can't manage their finances. But I also feel whatever system is in place needs to recognise that a default from 5 years ago for a small amount should not mean you end up paying high rates of interest with a non prime lender.

There is something a little backward that if you are classed as not having the finances you end up having to pay more.

But I don't feel all defaults should drop off under a 3 year period (or six neccessarily). We would have a real mess on our hands then.

Rico6.9

But I don't feel all defaults should drop off under a 3 year period (or six neccessarily). We would have a real mess on our hands then.[/QUOTE]

It's the satisfied/settled defaults I'm seeking to be removed ASAP. It's rubbish not being able to get a mortgage with a satisfied default. House prices might go up while we wait for the satisfied defaults to drop off. Then we can't afford the house. For some people this could be a family home they've aspired to all their lives. Denied by the very people who created the recession.

Pammy

I appreciate your point but I do think the system needs to show people who repeatedly get into debt but the current system doesnt really work as a good indicator for all people.

I dont really see it changeing in the current climate which is a pity

declaration

Rico6.9 wrote: »

. I've heard mutterings that the "6 year rule" may be reduced to 3 years as we move into line with European legislation in the summer. Even this is too long though.

Does anyone have any more information on this? It would be a lifesaver for me as I have one default from three years ago and can't get a mortgage because of it.

herbiesjp

There are lenders that will "ignore" defaults.

Some will ignore under £500
Some will ignore under £250

Some will ignore as long as older than 2 years.

However, whether or not you will be eligible will depend on whether or not you fit all the other criteria i.e deposit, income, commitments etc

Lots of different criteria, with different lenders.