Trust deed

jb1305

I've already posted on the IVA forum but thought I'd post here too.

My partner has a trust deed in his name and payments are due to end next year. We live together but the mortgage is only in his name. We have no joint accounts etc.

We want to save to get married in 2-3 years and save for a deposit on a bigger house. I'm aware it will show on his credit files for 3 years after it ends. Would we be better to keep finances separate in that period so it doesn't affect me? What are our chances of getting a mortgage in 4-5 years? We're hoping to have 40k plus any equity from this house - that should be approximately 20%- 30% deposit of a property depending obviously on how the market changes.

Tixy

Yes best to keep seperate finances entirely until his file is clear of all negatives.

Given the timescales you are talking about it shouldn't impact on his/your ability to get a mortgage at that time.
A year or so after his trust deed has finished he should then be looking to start building a positive credit history (may need to start with a subprime card first), so that by the time you come to apply for a mortgage you both have evidence of being able to manage credit.

jb1305

Thanks for the reply Tixy. Do you mean to apply for a card a year or so after he has finished the trust deed payments? Also, he is in a position where he should be able to pay the whole thing off early with a lump sum, not sure if this is possible - will this speed up the process or will it mean that simply we can look to rebuilding his credit rating quicker?

Many thanks.

camuk81

Tixy means apply for a credit card after the trust payments have finished. He will need to prove how responsible he is by getting a credit card he pays off every month to show that he is responsible. Sometimes no credit can be a bad thing. Paying off early is a good thing. Check on penalties etc before you go ahead and what the financial impact will be. The sooner it happens the sooner he can make tracks on his credit file.

Check with the supplier of the trust deed if you can pay off early before making any decision though

jb1305

Thanks for your reply. He has already contacted his trustee and they are contacting the creditors.