How long will a default be on credit file?

Smallfries

Sorry if this is the wrong place but i am at my wits end.

I went for a mortgage application as my gf and i are having a baby and need to get somewhere. My credit file was fine but GFs is bad, 3 defaults due to various reasons, all outstanding debt and she is in a debt management system. if, between us, we clear the defaulted debts, how long will we need to wait before the credit file is ok again? i cant afford a home on my wage alone and its getting me down now.

any help/advice would be a massive help

DarkConvict

Defaults last 6 years from the date they were placed, late payments last 3 years. Whilst on a DMp a creditor may go for a CCJ, a CCJ does even more damage than a default and last 6 years from the date it was placed on the file, which is 1 month after the court hearing.

Whilst on a DMP I honestly do not think she can get a mortgage as the risk would be considered to high. Even if you were accepted i would not take it because the rate you pay would be eye watering and you would regret it.

You are going to have to wait until your GF's situation improves because she will be seen as a huge risk, in addition it will create a financial link between the two of you. Meaning if you want credit (cards, loans, insurance) it can push up your costs just because of the link. And the link can't be broken until the mortgage is over.

Smallfries

you just confirmed what i thought, thanks. so really if we pay them off they still stay as defaulted settled for 6 years?

DarkConvict

Yeah. The date the defaults comes off does not change (or shouldn't if it does you can force them to put it back). Settled or unsettled the date it comes off is the same.

Also whilst on a DMP your GF should not be seeking to obtain further credit, a mortgage is credit. If your GF is with the right people getting help with a DMP (see list ) Then if she gets more credit they will stop managing the DMP, as it is a commitment they ask you to make.

If you have the money to make a full and final offer, you can ask as part of the agreement the default is removed. Very uncommon to be accepted but is known to happen. Template - http://forums.moneysavingexpert.com/showpost.html?p=30356419&postcount=27

The other thing you can do is challenge the default. For a default to be placed they must send out a default notice, getting proof they didn't send it isn't easy. But if you send a SAR and ge tno default notice back, or they admit they never sent it. Then the default should be removed.
Also if a default was placed more than 6 months after the default occured, then it is considered unfair by the OFT and again should be removed.

If you did default, and they followed the correct procedure of a default notice before a default, and applied within 6 months. Then really you have to wait 6 years!

Smallfries

Thanks Dark, you have been a massive help, its annoying to me as she has just buried her head in the sand, i dont know where i will go from here but def got food for thought.

MustBeatThis

Hello Smallfries

I can't offer practical help I'm afraid but I was in your situation 12 yrs ago when then bf (now dh) and I applied for a joint mortgage. It was then that I found out he had CCJS from 4 yrs before.

It made sense to stick with my previous building society as I'd not long before sold my own property and had to pay an early repayment penalty, which they'd give back to me if I took another mortgage out with them. I don't know if we'd have got another mortgage elsewhere?

In the end we just went for a mortgage in my name only, and bought a smaller property than we had planned for.

It could have caused a big rift. I was really angry for a while but I got over it.

I'm sure you can work a way through. Good luck.

Smallfries

Thanks for your comment MustBeatThis. I am sure we will get around it, i have always been good with a view i would want a mortgage but obviously GF doesnt have that train of thought.

looks like no mortgage yet but we can work on it, thanks