Words of wisdom needed re: mortgage

Ell78

Hi All - new here and hoping for your thoughts. Any words of wisdom, experience or advice greatly appreciated to hopefully avoid being laughed out of bank at first hurdle...

Husband & I are hoping to move. We currently have a mortgage on a two-bed house with NRAM - roughly £130k outstanding. Property value is around £160k. No adverse credit history on my part with exception of one late payment on cc. Husband has 2 (satisfied) defaults from 2008 due to drop off in 2014 (not skimming over seriousness of this - just know that excuses/sob stories pretty pointless).

Other info as follows:
Me: age 34, part-time employment - £12,700 p/a, no outstanding loans/no credit card balance or overdraft. 1 open cc account - 19 (well managed!) accounts on credit report.
Husband, age 36, £22,000 p/a, no outstanding debt etc (1 open & well manged cc with no balance to help rebuild credit score (7 well managed accounts on credit file)). Graphic design job - same employer for 7yrs (relevant?!)

We have 2 dependants (sons aged 10mths & 4 yrs). We have 7 years payment mortgage history with NR (£910 a month recently dropped to £730 a month as secured loan part paid off).

We bank with Santander and I received a call from them a few months back. The advisor was keen for us to remortgage and based on rough figures/affordability gave me a rough figure of £165k that they would consider lending. The defaults on husbands file have since been brought to my attention. Firstly, is there any point at all in me approaching Santander to follow up this conversation (I was on mat leave during first chat with no real plans to move) - or will we be told to get lost until 2014? (Obviously we would discuss the defaults with Santander before potentially wasting our/their time).

My second issue is that the amount they suggested seems fairly large to me - especially with our salary multiples. Is this a figure only applicable to Santander's lending (i.e. for high scoring customers). Would a broker be unlikely to find same amount with a different lender based on our criteria? (the reason I ask is because there is not a lot of point in moving house if the amount offered if likely to be much lower with other lenders).

I am keen to avoid rejected mortgage applications on either of our credit reports - so the more info/opinions I am armed with in advance the better.

Thanks for taking be time to read - esp as I am sure that there are many like me clutching at straws these days! If we need to wait until 2014 to move forward I can live with that (just about! House is v small)

P.s. in addition to the possible 30k equity in our house we will possibly have family help to boost deposit (although no suggested amount as yet!) Don't know how much difference this might make...

Dave_Ham

Santander will not lend if the defaults are registered on credit files appropriately. They changed lending criteria and now will not touch any adverse.

That does not mean all is over, I would check both your Experian and Equifax credit files.

If you can get to 20% deposit, then you will have options and 85% maybe.

The mortgage figure quoted is the upper limit that any bank will lend. Typically real indicative figure is that most will not go above 5 times salary..

Good luck

Ell78

Many thanks for your reply - I suspected as much...The defaults show up on Check My File so guess we'll give Santander a miss! Just out of interest is that x5 combined salary (any point in mentioning tax credits, child benefit etc)? Thanks again

Dave_Ham

With some lenders they will accept them, think it will be worth you having a fuller conversation with a broker...

Its achievable just very tight

kingstreet

Ell78 wrote: »

I am keen to avoid rejected mortgage applications on either of our credit reports

There's no such entry. All your credit file will show after a mortgage application is a credit search.

Ell78

Thanks for your help both. Will book an appointment with a broker and see how we get on.

All the best.

Thrugelmir

Ell78 wrote: »

P.s. in addition to the possible 30k equity in our house we will possibly have family help to boost deposit (although no suggested amount as yet!) Don't know how much difference this might make...

If you can afford a larger mortgage. Then it should be possible for you to make overpayments on your current mortgage balance. Thereby reducing the debt you currently owe and saving interest in the process.

Ell78

Great point (amazing how thick you can be until you see it in black & white!) Thanks a million.