Refused our first mortgage - Shared equity - Help please

Thehighlander_2

As above.

Little bit of backround.

I am 26 and my partner 22 we are in Scotland
Both in full time employment for a long time
NO debt at all
£14k in our savings
We both have a credit card to build our rating making short payments ect
I have 2 contract phones never missed a payment
Partner has a mail order account and has never missed a payment
My Credit score 965
Partners 982
We have a joint bank account and have a overdraft of £1000 we come and go out of this all month but when paid we are fully out of it.

The property

£161
Anyways when I was 17 i destroyed my credit rating with catlogues ect only up until last November I had about £1500 of debt to my name I had never checked my credit report and it was in the poor rating.

Anyways I phoned all companys paid it off and now my credit score is up at 965 on Experian NONE of the companys i owed money to show on my report its squeeky clean now - I took out a capital one credit card use it to boost my score and its worked.

My parters cerdit rating is 982. She has a default for £160 from 5 years ago and it was settled as of last year.

We are good with money but in our younger days we were stupid but have learnt the lesson.

Anyways we went to see a mortgage broker to apply for a mortgage with shared equity via Tullochs (We are in Scotland) property is £161k and loan amount £129k we have £14k in our savings, Halifax wanted a £8k deposit. We got rejected but this was because of the outstanding debts we had last year. And both had "poor" credit ratings

We tried again 2 weeks ago and got a referrel and then found out that my partners default was not amended to satisfied it was still defaulted and showing unpaid (it was paid November 2011), we called Equifax who have sorted the issue now and its satisfied, it was an error on their behalf)

Will this be because of my partners default?

What options do we have now?

We bank with Halifax.

Persoanlly I think our broker is a "!!!!!!" he doesn't give us the information we need and is very pushy, I was planning going to meet with the bank and see what they will do for us. We have the funds its just getting a yes now.

I know its our own fault we got in the situation but we have learnt our lesson and paid our debt.

We have been renting our current property for 5 1/2 years now never missed a payment.

---

So to summarise

October 2011 we applied for a mortgage - Shared equity and got refused
We checked our credit reports and seen we had outstanding debts and terrible credit ratings.

November 2011 - All debt cleared and we got capital one credit builder cards - Made small payments for fuel and paid them off when got home and it has built our credit

March 2012 - Reapplied for mortgage and got rejected - Checked credit report and the misses default showing was unsatisfied (Experian never amended it)
Now its fully amending showing satisfied (it was for £160)

Really looking for some help to find out will the bank help us ect

Thanks in advance.

I could of mixed things up as I have tried to add as much detail as possible so if it makes no sense let me know.

Dave_Ham

Ok - a few bits here - firstly love the description of the broker - they are out there unfortunately.

So, Halifax are amongst the most flexible highstreet lenders although they are unlikely to tolerate a default satisfied or not within the 6 year period..

I am not super experienced in Scottish shared schemes, but there is a significant difference between shared ownership and shared equity and it makes a huge difference to the lenders and policy in play...

Credit card game you played was a smart move, but do not give too much stance to the actual numerical score. Saw a client Thursday who had Experian rating of 976 - although 3 unsatisfied CCJ's and 2 unsatisfied defaults..

Good luck

Thehighlander_2

Thanks for the response much appreciated.

Thats what I mean I don't personally know much about mortgages so we are not sure where we stand at all with credit ratings ect as it seems very misleading if that makes sense.

Would you suggest going to meet with my bank (Halifax) and just speak to them and see what they say.

The default drops off May 2013 if that makes a difference.

Its Shared Equity 80/20 we have £14k in our savings but could get more if it was needed if it would make a difference. Not much more maybe £3k.

Dave_Ham

Assuming your broker is a "!!!!" they may not be experienced enough or have the contact to get a better understanding of the decline reason.

My concern would be as I have just re-read the initial information that you both have a less than perfect credit rating, although you are advantaged by the fact you bank with Halifax.

I think that the default is the fail reason. Although please take this with the consideration it deserves, I have not seen your credit files or the Halifax application details and am just preferring an opinion...

If you can get the property and the mortgage in sole applicant details, this may be a solution.

Alternatively a local Building Society can show more flexibility around credit score as typically they manually underwrite. They are not mad keen on shared equity properties mind you so be aware...

Good luck

Thehighlander_2

Thanks again.

Well tbh it doesn't have to be shared equity we go for we found a normal house for £130k but our "advisor broker" told us we would be better with SE...

I think we will meet with Halifax and see what our options are it least we have explored them. As for Building societys we don't know much about them if I am honest.

Surely the postive facts outweigh the negatives.

Our desposit
Credit score
Credit cards
Both in fulltime jobs ect

I understand my partner has a default. If we were to wait till next may would it be alot easier for us as it would be off her record by then?

We don't want to have to wait but.......

Dave_Ham

Your positives would stack up on a building society scales but if computer says no to a high street lender then typically it says no...

Once the default goes, you are plain sailing from what you have said.

The computerised Experian scores mean absolutely nothing and I genuinely mean nothing. The information in the reports is crucial, but the score is completely irrelevant..

See how you go with the Halifax, let us know and shout for any help...

Thehighlander_2

I think I will speak with Halifax and a Building Society and see what they have to say.

As I say we have no debt at all, we only use our overdraft thats it (Does this count against us?)

Thehighlander_2

We have a meeting with the Yorkshire Building Society on Saturday.
My fiance failed to tell me the women she works with her sister is the mortgage manager their so the meeting is with her.

We are going for information and to see if we are able to go ahead with a mortgage.

All comments are welcome in this thread as I am happy to hear from everyone or anyone who has had similar troubles.

Thanks

Thrugelmir

Thehighlander wrote: »

My parters cerdit rating is 982. She has a default for £160 from 5 years ago and it was settled as of last year.

Picked this out. It will impact significantly from the lenders perspective. Small amount owed but 5 years to clear.

Thehighlander_2

Yea we were thinking that.

We are also getting the company we let our flat from to make us up a letter on headed paper to say we have never missed a payment ect.

Apparently its a person who underwrites the mortgage application, I was advisded to do the above from a friend who said it will do no harm.

She "!!!!ed" up but we are doing everything to show it was a mistake and nothing else.

All we can do is see if they will give us one, if not why? And what can we do to get one. Thats all we can do I suppose.

I told the women the above on the phone and she said not to worry about it, we can speak about it on Saturday, I said I didnt want to waste her time by coming in and getting refused instantly if that makes sense (Im a panicer) she just laughed and said we all make mistake we will have a look on Saturday and see what we can do for you.

I know she is just being positive its a dam sight better than the broker was....

bigadaj

If you can find a house within your limits then it would be advisable to go for that at a lower price, shared equity makes things far more complicated.