Rejected Application

stupidman87

Hi I am new to this and I am after some advice. Me and OH have just been rejected for a mortage due to adverse credit. We have checked our credit reports and on mine is an old default that was paid off in full in 2008, however it has a settlement date of 2011. Would this be the reason of the objection as there is nothing else on there?

ACG

Who was the mortgage declined with?

What month in 2011 was it settled? and how much for?

GMS

It will depend on lender, loan to value and default details amongst other things.

How much was default for, when was it put in place, how much for amd which lender declined? How much were you applying for and what value/purchase price?

stupidman87

Mortgage was with Halifax, who we are currently with. Sorry the date satisfied was November 2010 and it was for outstanding credit card default from previously. i think that the amount was £7,500 however there is no amount on the CRA.

We were looking at a mortgage of £160k for a £200k with using the current equity in our current house to pay the remainder.

We received a MIP from them and looked at properties, We then applied and was told it was with the underwritiers as there was a linked address (this was our old address where the debt came from). I explained this to the Mortgage Advisor, was then told that the mortgage had been agreed and they needed sight of payslips which we provided, the day afterwards it was again with the underwriters and this time they refused it.

We are both very confused in what we can do to get a morrtgage in the future.

Thrugelmir

From an underwriters perspective it has taken you 3 years to repay a debt. You are not injecting any equity into the new purchase, i.e. cash saved. So the concern will be that you live manage your finances to close to the wire. Any change in financial circumstances would leave you at risk.

Now that you've paid off your credit card debt. Use the freed up cash to over pay your mortgage. Thereby by reducing the amount you'll need to borrow in the future.

stupidman87

Thanks Thrugelmir,

From your perspective, what sort of payment should we look at we can do 10% per year which equates to £9.5k this year. If I do this and look again at mortgages in a years time or longer?

We currently live in a three bedroom house and need the extra room for the 5 of us?

All of this is very confusing to us both as they agreed then rejected!!!!

Thrugelmir

stupidman87 wrote: »

All of this is very confusing to us both as they agreed then rejected!!!!

Ultimately the only people who actually approve a mortgage offer are the underwriters. These are the faceless people who sit in the backroom.

Front line staff as such have no powers to either accept or decline. Though applications will fail at the first hurdle if basic requirements are not met.

Four of the six major lenders bar are actively contracting their mortgage books. So lenders can choose their customers, those they wish to do business with.

Events are moving rapidly at the moment. So I wouldn't recommend any other course of action than look after No1. Though a regular review of ones finances is advisable. Keeping a diary of expenditure is often an eye opener.

Look after the pennies and the pounds take care of themselves. As the old saying goes.

stupidman87

The real confusion though is that the debt was from 2004, the debt collection agency did not get in contact with me until 2006/7 when we paid it off in full with savings, why then does it say on the cedit eport that it was not satisfied until 2010!!!

Thrugelmir

stupidman87 wrote: »

The real confusion though is that the debt was from 2004, the debt collection agency did not get in contact with me until 2006/7 when we paid it off in full with savings, why then does it say on the cedit eport that it was not satisfied until 2010!!!

Ask for a notice of correction to be put on your credit file, to redate it as 2008. Possibly the satisfaction notice was posted during an administration clean up exercise. Hence the time delay.

You didn't make any attempt to repay the debt yourselves. This in itself has left a major stain on your record. That won't disappear for a while.

So you should be kicking yourselves not blaming other parties.

stupidman87

I am kicking myself and I am not blaming others....my mistake which I accept and I am tying to move on with my life.

CBR600F_2

How hard are you kicking yourself? I've several advanced degrees in the field of kickonomy, and you can take it from me that the effectiveness of a kick is mostly dependent on the type of shoe you're wearing. I'd recommend a decent hiking boot, or better yet - a combat boot.

Ultimately, kicking oneself is very ineffective. Better to have someone else kick you. I have the numbers of a troupe of burly, broken-nosed thugs I can put you in contact with if you'd like. They'll kick you until you're unrecognisable, and for a very reasonable price.

By the way, have you seen my little puppy? He's called Simon. He ran off and I'm ever so worried about him. I've tried crying and screaming, but he hasn't come back yet. It's nearly his bath time.