Future mortgage with defaults?

TakingControl

Good afternoon everyone :j

I might be asking a tad in advance but I would like to be as pro-active as possible to hopefully obtain a mortgage in 1.5 to max 2 years time and wanted to see what peoples opinions are with respect to deposits/credit file etc.

Bit of history:
- I was on a joint mortgage previously so would not be classed as FTB I assume even though I don't own a property anymore (I rent at the moment)
- I had my LBM in 2009 with debts at £45K and by the end of this year I will be debt free :j
- ONly 2 out of my 6 creditors defaulted my account when I had financial problems, both in March 2010. One is satisfied since February 2011 and one will be satisfied by the end of the year, both in full, no F&F
- ONe creditor accepted a F&F at 55% of the sum owned, no defaults just some late payment markers beginning of 2010/end of 2009, then all green. Settled since February 2010
- I have now only 1 credit card to pay off, no late payment markers since end of 2009

I am well aware that the defaults will work against me but by the time I have saved a 10-15% deposit (about 1 year based on saving the money I paid back at debts instead). I then have no debts and only a phone contract.

Income is £46320 before tax and I doubt in the current climate there will be any raise so working on this figure.

How long should I wait to apply for a mortgage? Should I risk it in 1.5 years with defaults only being 4-5 years old? Or would I have a realistic chance for a mortgage?

I know its some time off and the market changes but its a goal I am working now towards too and any info would be great. Thank you

Thrugelmir

Your default date ends when settlement is finally made. If a lender feels so inclined. As the account is technically in arrears.

Suggest you target a minimum of 15% deposit and possibly even higher.

TakingControl

Thrugelmir wrote: »

Your default date ends when settlement is finally made. If a lender feels so inclined. As the account is technically in arrears.

Suggest you target a minimum of 15% deposit and possibly even higher.

I am a tad confused? I am aware the default won't fall off my credit file until 6 years of the original default date, so March 2016. The defaults will be settled for at least 18 months until I try for a mortgage so wouldn't still be in arrears?

Thrugelmir

An account remains in default until settled.

A default is technically non payment in accordance with contractual terms.

TakingControl

Thrugelmir wrote: »

An account remains in default until settled.

A default is technically non payment in accordance with contractual terms.

Thank you, I am aware of that but in my case when I will apply for a mortgage they will be settled (one is already, just paying off the second) in full. So I am not sure what you are trying to advise?

Thrugelmir

That if the lender is still flagging the account as being in arrears. That they won't disappear off your credit record until 6 years after they are settled.

Suggest you use a broker to find a mortgage. They'll have a better idea of what individual lenders will accept or not accept.