Mortgage suitability

doodah

My partner and I are considering purchasing a property together, he currently owns a home so we would hope to have a deposit of around 20%. My credit history is not the best, 2006 was a bad year with missed payments and a couple of defaults, I also have a settled CCJ for £295 from February 2007. I am now debt-free as of March this year, with no missed payments since 2006. I have a credit card (Vanquis!) which I use and pay off in full each month.

I think by the time we got around to it my shady history including CCJ would be 5 years in the past, so my question is how much would it affect our chances of getting a mortgage with a decent rate? My partner has had his mortgage for almost 14 years with no missed payments and has a good credit history. I think at a push he could raise the mortgage on his salary alone but that wouldn’t be ideal for us and not particularly secure for me. I’ve also been told in the past mortgage companies aren’t keen on giving mortgages in sole names when the person has a partner, is that true? Many thanks in advance…

The_Palmist

doodah wrote: »

I’ve also been told in the past mortgage companies aren’t keen on giving mortgages in sole names when the person has a partner, is that true? Many thanks in advance…

That's a first. I am not sure but I have read somewhere that CCJ will show on your history for a long time.

The_Palmist

Is he still paying his mortgage ? If not then sole application might be the best/only option.

herbiesjp

Based on the credit history highlighted above, you will be able to find options.

However what rates/options you will get, will depend on ALL the scenario.

doodah

herbiesjp wrote: »

Based on the credit history highlighted above, you will be able to find options.

However what rates/options you will get, will depend on ALL the scenario.

Thanks! That's reassuring. I suppose it's a case of getting advice at the time to find out our best options.

Yep I know CCJs stay on your file for 6 years.

holly_hobby

Defaults certainly "fall off " your credit record at 6 yrs.

But, you need to be aware that in the case of a CCJ (which is a court order for payment) the original creditor (if the CCJ remains unsatisfied at 6 yrs) can re-apply to the courts to have the debt re-registered. Most don't but it is something to be aware of and check on at the time.

The situation with adverse credit is that the older it is at the time of mge application the better, also if you can provide a reasonable explanation to the lender why your finances were out of control at that time, and why your situation is different now. (obviously the amount of & number of defaults/ccj's, and whom registered them also play a part i.e anything to do with HMRC would present a real problem).

What the lender wants to see is that the adverse credit you hold, was not as a direct result of your poor attitude to debt, but from circumstances outside of your reasonable control i.e loss of job, relationship breakdown resulting in loss of income - and not just because you had over committed yourself.

So you want to present yourself in the best light as possible when givng an explanation as to why you incurred adverse data.

Mge applications can be in one name (obviously if income is sufficient to service the loan) or two (even 4 names are permissible).

If however, there is someone over the age of 17/18 who is to reside in the property, who will not be party to the mge - they need to sign a disclaimer stating that they will vacate the property upon any reposession order placed on the mortgagor (borrower).

So in the case of a couple, you can have just one name on the mge app, with the un-named simply signing the consent order as above.

Hope this helps

Holly

doodah

Thanks Holly, that was really helpful. I think the thing about people over the age of 18 must have been what I was told in the past. My CCJ was satisfied within 2 months of getting it, so has been for 4 years now luckily.