First time buyer?

LRAW2012

I'm in need of some help and advice!

Me and my partner are looking to buy a property and we should have a deecnt deposit in the next few months.

My partner has an annual salary of approx 20k with a credit score of approx 800. She has a current loan of 8k too.

I have a annual salary of approx 38k but with a poor credit score below 350. This is due to two defauts (settled) in 2008 and 2009. I have no outstanding debts.

We are looking to purchase a property for around 80k and we will have a deposit between 10% to 15% in the next couple of months.

I know we should contact a broker but before we do can anyone offer some advice or give us an idea if we would be likely to get a joint mortgage?

I have searched online and found plenty of 'bad credit' mortgages brokers who insist they can find the product we need but I dont know how reliable these sources are.

Has anyone else successfully secured a mortgage with similar circumstances, credit score etc??

Thanks in advance!

thomasdown

LRAW2012 wrote: »

I'm in need of some help and advice!

Me and my partner are looking to buy a property and we should have a deecnt deposit in the next few months.

My partner has an annual salary of approx 20k with a credit score of approx 800. She has a current loan of 8k too.

I have a annual salary of approx 38k but with a poor credit score below 350. This is due to two defauts (settled) in 2008 and 2009. I have no outstanding debts.

We are looking to purchase a property for around 80k and we will have a deposit between 10% to 15% in the next couple of months.

I know we should contact a broker but before we do can anyone offer some advice or give us an idea if we would be likely to get a joint mortgage?

I have searched online and found plenty of 'bad credit' mortgages brokers who insist they can find the product we need but I dont know how reliable these sources are.

Has anyone else successfully secured a mortgage with similar circumstances, credit score etc??

Thanks in advance!

1st off Credit scores mean absolutely nothing. There are many posts on here that back that up. Its about how good you are at paying your debts.

Good things in your case is the combined salary of £58k but the £8k loan will reduce this to £50k. But on a £80k property minus say a £10k deposit. You only will probably need to borrow at max 1.5 times your combined wage. Which is brilliant.

But as you have said the negatives are the defaults. The only thing to suggest which you have already answered yourself is go and see a good (recommended) whole of the market broker. They will know the lender where best to put forward your application, because they have experience and will probably have other similar clients who have recently been accepted in the same circumstances that you tell them. Just be 100% honest with all debt and the defaults and they should find you a deal to suit. Hope this helps. Let us know how you get on.

kingstreet

I think it would be sensible to obtain copies of your credit file from all three CRAs to take them to the meeting with a broker. There's nothing worse than thinking you know about all the issues, then something unknown pops up.

Equifax

https://www.econsumer.equifax.co.uk/consumer/uk/gb_consumerletter.ehtml

Experian

https://secure.wiseconsumer.uk.experian.com/wiseconsumer/secure_index.html?data=00

CallCredit

https://www.callcredit.co.uk/stat-report-online/index.php?action=register_display&tpl=regPurchase

All brokers tend to deal with adverse credit cases. Don't think you have to pay thousands in fees. You don't.

LRAW2012

Thanks for your reply.

Great advice.

I was under the impression that any outstanding financial committments e.g loans etc were deducted from the amount you can borrow not taken from your combined salary. For instance, if your salary qualified you to borrow 50k then the loan value would be taken off that so if you had a 10k loan you could only borrow 40k.

So I guess based on the responses we should be fairly confident in obtainning a product to match our circumstances?

Do you have any idea what mortgage my partner could get on her own? (see above post for details of her situation as an individual).

Thanks in advance

kingstreet

It's the cost of the loan which affects you, not the amount you borrowed.

A loan costing (for example) £200 per month (with more than 6 months left to run) takes £2,400 per annum off your income before it's multiplied out. So a lender giving 4x income is going to tax your borrowing power by £9,600.

In answer to your second question, deduct your partner's loan repayments from her income and multiply the residue by 4. That should give you a reasonable idea of her sole borrowing power.

One thing worth bearing in mind. Don't apply for anything in joint names until you are CERTAIN it's the right way to go. You will create a financial association on the credit files and this will mean your association will drag her down if she did try a sole application.

Like I said, credit files, then broker meeting.