Do I have any chance of getting a mortgage?

dt2703

I am 32 years old now, and have never had a mortgage.

I don't have any savings, and have no way of getting any sort of loan from friends/family.

I can start saving (in a few months once a few things have been paid off), but realistically it's only going to be around £100 per month.

I also have a bad credit rating, in that as a youngster I took a credit card, maxed it out on DJ equipment and didn't pay the money back. Foolish I know, but I was young (dumb), and as much as I regret that now I can't change it.

I am a little ashamed to admit that this debt is STILL hanging over me. I have moved around a lot over the years, and only recently decided to register with CreditExpert (to find out why I kept getting refused credit for anything more than a mobile phone contract). I entered all previous addresses on their website, and it was this that enabled the company in question to tie everything together and finally make contact with me. I swepped it under the carpet so to speak (moved around and didn't keep public records up to date - never registered to vote, etc) and over the years I gradually forgot about it.

The original debt was for around £4000 and is now somewhere in the mid £6000's. It's owed to Cahoot.

I also have another debt, which was also around £4000. I've been paying this off for a couple of years and it's down to just over a grand now. I guess I was sort of waiting for that one to get paid off, and then planning to use the money I pay them each month to clear the outstanding one... (I can tend to bury my head in the sand a bit I guess it's fair to say).

My credit record has a LOOOONG string of red boxes for the Cahoot debt, and they have registered the date of the debt as 2009 (I actually took the loan out about 10 years previous), and when I enquired to CreditExpert about the "will only stay on your record for six years" and the fact the debt is twice as old as that already, they basically told me to stop trying to duck out of it and pay them off (fair comment).

Recently my father died, and for a while it looked like I might have been left enough money to clear this debt and maybe even have enough left over to put down a deposit on a mortgage, now sadly it looks like this is not going to come to fruition and i'm back to square one.

I'm starting wonder if i'll ever dig myself out of this in time to get a mortgage. I would dearly love to own a house of my own, I hate paying somebody elses mortgage and having nothing to show for it. I also hate having to call the uninterested letting agents everytime something needs attentin as i'm not allowed to do even the most basic of upleep work.

Would any lender ever touch me?
With no deposit and bad credit it seems like a bit of a pipe dream.

If I owned a house I would take out a loan against it and clear these debts (it would only take about 7k)... but I feel stuck in my situation.


Any advice greatly appreciated.

CloudCuckooLand

You are correct its a pipedream, as things stand. That doesn't mean you should give up. You'll get there in time.

Renting gives you a roof over your head - that is more than millions around the globe have...

tbourner

There's no way you'll get one at the moment, but that's true for a LOT of people right now. You need to pay off all your debts and start saving, see where the markets go over the next few years and then look into it. I'd say you're looking at 5 years before you'll be able to do it though, unless you find a pot of cash somewhere.

dt2703

I would be best off clearing debts, and then saving for a deposit then?

Rather than reducing repayments to a minimum and trying to save big time, then trying to get a mortgage on the back of the deposit and trying to get a loan against the house to clear the debts?

How do mortgage lenders look at age? I mean at 37 for example, would I be offered a lesser/worse deal/rate than someone 5/10 years younger?

Not that it really matters to me currently I suppose.....

beecher2

Yes, clear off your debts and then save as much as you can. At 37 you'd be offered exactly the same deal as someone who was 5/10 years younger, so don't worry about that. If you get a 25 year mortgage at the age of 40, you'd have it paid off before your retirement age.

The Debt Free Wannabee forums are the place to go - if you post a Statement of Affairs you'll get great help on budgeting, and help on dealing with the Cahoot debt.

tbourner

You're saying you want to get a mortgage to buy a house, then remortgage the house to pay off debts? You'll only be able to buy a house with the percentage they offer of loan to value at the time, so say you get a 25% deposit and a 75% mortgage, you won't then be able to borrow any more against the house as you'll be at 25% equity. You'll have to pay off some of the mortgage or gain value in the property before you can borrow more against it! All this time you'll be paying interest on your debts (I assume?).
Either way, it's a pretty backwards way to do things, IMO your best bet is to pay off your debts and then save as much as you can.

As for age, it will only be reflected in the length of term you get offered AFAIK, you may only be able to get a 15 or 20 year mortgage deal for example.

Mat_Lock

Are you me in disguise. I am 32 years old, no savings, mid range debt and renting. My first credit card got maxed out buying dj equipment and it's been forever battling the debt since then as kept being a card tart and moving around but getting more credit added which I then spent that was over 10 years ago now. I did clear my debts 3 years ago but that was to save up for a round the world trip that lasted 19 months and spent over £22k. Came back with £4500 debts and slowly clearing it.

I look at the fact I won't be getting a mortage any time soon but the way the housing market is, that doesn't bother me. I got a good flat I am renting that's cheapish. Once my debt is gone, it'l be save save save and I hope to have a decent deposit for a house by the time I am 37.

dt2703

Thanks for all the replies, I appreciate you taking the time to respond to me