Mortgage with 15% deposit and defaults. Is it possible?

Angel1090

Hi all,

I'd appreciate some help. My boyfriend and I are looking to buy our first home. We've seen a place we like but only have enough savings for a 15% deposit.

I have an excellent credit score, but my boyfriend has defaults from a few years ago. They total £1000, but this is because a debt was registered twice, with the original company to whom the debt was owed, then an agency who bought the debt. We have paid off the debts but we're still waiting for Equifax to mark one as 'settled'. We have no other debts and both have credit cards which we use regularly and pay off each month.

A mortgage broker has advised us that with only a 15% deposit, and my boyfriend's defaults, we can't get a mortgage from the high street lenders. I can't afford to buy by myself as my salary is not high enough to cover the cost of the property.

Does anyone know of a lender that would consider lending under these conditions? I would really appreciate any advice. Thanks

GMS

How much is your partner's salary? How much is yours? How much are you looking to borrow?

holly_hobby

You can not be defaulted twice with the CRAs for the same account.

I suspect that 1 default is from the original creditor, and the 2nd from the DCA who purchased the debt from them, and now own the debt & its rights.

So, the default for the dca (whom I presume you have satisfied this default with) is correct.

You need to push to get the default previously registered removed. To that end I would firstly contact the Credit Reference Agencies (CRAs), and advise them of the error. They have a legal duty to correctly record any data held on you, and as I say you cannot have 2 current defaults registered for the same debt.

They should mark the dispute entry as just that "disputed", this means that anyone reading your credit ref report needs to be aware that the entry may not be valid or correct.

The CRAs should then contact the company who placed the disputed default - as it is only on their request and approval that the CRA may amend your CRA with details such as account payment history, defaults and ccjs.

It may also be a good idea to contact the company themselves and request for the duplicate default to be removed - advising them upon what basis that you are requesting this.

I am not saying that with the duplicates removal that you will be able to go high street, as I don't know the rest of the story or why your partner defaulted on his credit commitments.

But in todays market, if you have more than 1 small (justified & satisfied) default, with only a relatively small deposit - I do think that the high street may not currently be the place for you.

You should be aware that on the 6th anniversary of the registration of defaults, they do "fall off" your credit record. Naturally I don't know how old your partners defaults are, but once they have "disappeared", and of course you haven't obtained any more adverse credit data (!!), then the high street will open back up to you. (subject to your meeting standard lending & underwriting criteria).

So going "off" high street could be seen as a temporary measure, and that once the above has been achieved you could look to move back into mainstream lending (as I say as long as your circumstances at the time meet standard affordability and status criteria).

Hope this helps

Holly

Angel1090

Both my boyfriend and I work in the casino industry, and earn £17,400 a year plus about £700 in tips. The flat we want to buy costs £138,000 and we have about £20,000 for a deposit, and can add what needs to be added to make it up to 15%.

My boyfriend's debts are from about 4-5 years ago, when he was an idiot and defaulted on a couple of mobile phone contracts at a previous address. We had no idea of these until we checked his credit report recently, and have since paid them off, but I think it'll be a couple of years before they actually come off his record.

The one that's been registered twice was from T Mobile, who sold the debt on to a collection agency. The debt's been settled with the agency, but is still showing as a debt to T Mobile, so we'll try and sort that.

If we can't go "High Street", what options are there? I know we could just wait for a couple of years, but we're sick of throwing away decent money on rent, and want to get our own place. I'm a first time buyer and absolutely new to all this. Thanks for any help guys

Laurs79

Try the post office for mortgages.
They only take in to account your last 3 years credit when applying for a mortgage - so if your boyfriend defaulted 4 years ago then you should be fine. They also lend you 4 times your JOINT annual salary AND give a 90% LTV for first time & remortgages !!!

Good luck ! Post back & let me know if you were successful ! :beer: