Mortgage application with default

dreyn123

Hi all,
i'm a uk citizen, working in the UK but living in Europe. after 6 years we have decided to return to the UK as my job is getting more involved and commuting is becoming too much.

Anyway, we have been looking a buying a house, after selling ours in europe we have a sizeable depoist, around 40% for the price we are looking to spend, no loans and a credit cards which is cleared every month.

What I also have is a default on my credit file from early 2008. I had no idea i had it as i thought the debt, a credit card, had been cleared. we had no communication from the credit card company as we had been 3 years abroad and our mail forwarding had finished. It only appeared after i started to process a mortgage application.

I am now struggling to get a mortgage, even with a sub prime lender as my wife has no proof of UK residency at all for the last 6 years.
I have not contacted the credit card company but am more than happy to pay the full amount off if they remove the default.

is this possible? would a high street bank lend if I have a satisfied on my credit file if i can't get the default removed?

any advice would be really appreciated as we have found a house, nearly bough it twice but each time an issue with the mortgage offer comes up at the last minute!

cheers

McKneff

Even if you clear a default it will stay on your file for six years, but it will be marked 'settled'

Doesnt really help in getting a mortgage though, can you put off buying for another 3 years?

dreyn123

thanks for your reply

not really, it seems now is the time to buy and we have found a great house at an even better price.

i've read on the net where people have had defaults removed but these seem to be on a technicality.

does the fact that i havent recieved any communicaqtion from the cc company, due to moving abroad, have any bearing, also the fact i would repay the oustanding debt and any associated costs?

herbiesjp

I doubt you will get the default removed.

It will stay on file but show as satisfied.

How much was it for? When exactly was it registered on your credit file?

You may have a few limited options, but I would suggest involving the help of a good whole of market adviser to avoid damaging your credit score by applying to lenders who are then going to decline the mortgage.

The adviser would look at the whole scenario, and then based on ALL your details, make a recommendation to you.

dreyn123

the default was registered in march 08 and the original amount was £1500 but with charges its £2000.

i've spoken to a couple of lenders, I Group failed the survey due a factory across the road and the others, Kensington and Platform, wanted a joint apllication but my wife has no proof of residency.

cheers

herbiesjp

Problems with proof of residency where? In the UK (or Europe where you have been living)?

Does she have nothing at all in her name?

Is your wife a UK national also?

dreyn123

Hi herbiesjp
proof of UK residency, which we have none apart from joint uk bank account which we kept going and i have my salary paid into.

I have enough documentation via work and other official correspondance.

The problem seems that the default stops us going to the high street and the sub prime lenders want a joint application, as we are married.

herbiesjp

You should have options.

A joint bank account is proof of residence for your wife also.

However the location of the property may be troublesome - resale value could be affected by factory etc, and as you have found out, some lenders will decline becuase of it.

There are several complications, and you need the help of a professional to make sure you fit criteria on ALL fronts before applying again.