Mortgage with bad credit history

nickscotland

Hey,

Was hoping someone could give me a bit of advice... I'm a first time buyer!

Me and my partner have found a flat that we want to buy. Our mortgage was agreed in principle however after furthering the application, we have been declined as I defaulted on a loan a few years ago and I am currently paying it up via a debt recovery agency.

My question is, if I had to pay the full amount off - would this make a difference if I can prove that I have nothing left outstanding or would I need to wait a while before applying again?

Cheers,

Nick

GMS

A default will remain on the credit file for 6 years. Satisfying it will help but not necessarily make any application successful.

There are lenders who consider historical adverse credit but you would need a 20% minimum deposit.

property.advert

It isn't going to help much if you settle it 20 minutes before you ask someone to lend you masses of money is it ? Yet settle it you must in your situation. Then pull your credit files (all of them) and see where you are and work out when it should drop off.

As a point of interest, I queried borrowing around £350k on a £500k property with 2 four year old defaults which ended up as CCJs and charging orders, all repaid shortly after being issued and from speaking to a few intermediaries, they were able to source funds which were not too far off the best in the market at the time.

You can google around, then email and telephone lenders but I'm not sure many brokers are going to give you a free lunch and tell you who these lenders are who lend to those who have bad credit. Some hefty fees to be "earned" out there so watch out !