Bankruptsy, repossessions and morgages

gmt0587

Bankruptsy, repossession and new mortgages
Hi all

After being declared bankrupt 4 years ago my new partner and i applied for a joint mortgage and unfortunately were turned down. I informed the company about me being made bankrupt prior to the application but not the repossession as i didn't think it had any barring. BTW they had previously stated that my bankruptcy wouldn't be a problem.

1. How long will it take for the bankruptcy to disappear from my records
2. Will i still be able to get a mortgage as we have made an offer on a house we like and can easily afford to pay the mortgage.

I have moved this thred on the advice of another forum member from the bankruptsy section.

Many thanks in advance for your help and advice.

Gary

kingstreet

It's really not as simple as the point it may disappear from your credit file.

I suggest you discuss this matter with your solicitor. You may find yourself in a situation where you get a mortgage offer, but the solicitor's bankruptcy search done just before exchange picks it up and the lender then thinks twice and withdraws your offer.

On the other issue, I would expect many lenders to blanket decline all applications with a positive answer to the question "Have you ever had a property repossessed?"

kingstreet

More;-

http://www.fridaysmove.com/why-are-bankruptcy-searches-carried-out-conveyancing-process/13209

The reason a Bankruptcy search is carried out by the purchaser’s conveyancing solicitor as a part of the conveyancing process is to establish whether the purchaser is, or is about to be, bankrupt. The bankruptcy search is carried out purely for the benefit of the lender. Where the purchaser is a cash buyer there is no need for the conveyancing solicitor to carry out this search.

It is likely that the lender will withdraw their offer if they find that the purchaser (borrower) has or is about to make a bankruptcy filing. Where the purchaser does not need a mortgage there is nothing to stop a bankrupt purchasing, however it is likely of course that the trustee in bankruptcy/official receiver will claim that property for the bankrupt's creditors.

gmt0587

Hi Kingstreet,

Firstly many thanks for your quick reply.

I had my property repossessed in 2007. At the time it was in joint names with my then wife who i have since divorced. My current partner has a very good credit history and we will be looking to borrow approximatly 55%. Also my current partner is only around £20k short of affording the house by herself. I will certanly take on board your advice and make sure we speak with the solicitor.

Gary

gmt0587

Kingstreet.

Belive me when i tell you that there will no chance of either of us being declared bankrupt. We had intended to have around £7k in savings and also to save around £800-1000 a month as well to try and clear the mortgage as soon as possible. I know however in these current times that lenders may be a little reluctant to lend to us at the moment. I just wanted to be able to see the light at the end of the tunnel

Gary

kingstreet

In a cackhanded way I'm trying to warn you that not disclosing it to the lender, as it's not on a credit search, may backfire on you after paying out thousands in fees because the solicitor check isn't done until near exchange.

Just be careful.

gmt0587

I will def be 100% honest with any application i make as i cant bare the thought of losing a house at the eleventh hour OR having to pay out any charges / fees for nothing.