Mortgage Arrears following Redundancy

Permafrost

Hi all,

A little background, I purchased a two bedroomed flat as a first time buyer in 2007 at the peak of the market with a mortgage from N&P at 5 years fixed 5.18%. Back in July 2011 I was made redundant from an employer I'd been with for over 5 years.

Job hunting in construction while trying to complete a masters was a nightmare and despite my initial optimism I repeatedly got shot down, i applied for supermarket jobs and literally anything and wouldn't even get a look in - so many other people looking, it was not a good time to look for work! I was struggling more and more to make my commitments to pay bills.

I'd had a lodger living in who paid enough to cover the mortgage, they unfortunately needed to move on.

This was the final straw and I missed a Direct debits on my mortgage, by which time i was pretty depressed and not thinking straight! This happened in September and October 2011, however in both occasions I paid within 25 days, so just late.

I had telephoned N&P in September to request to go onto interest only for a short period but was told, pretty bluntly that it wasn't possible.

I managed to re-arrange everything and got back into mortgage first payments, so i was clear then on up till December...

Anouyingly a DD change went wrong (part of switching everything around to make sure i made payments) and Decembers payment at the end of the month was not taken. I imeadiatly called the next day but of course closed over xmas... there is no facility to make payments remotely with them UNLESS you are in arrears, in which case you just phone up and pay via debit card...

I sent a cheque in, as i couldn't see any other way of covering it quickly that they would accept.. i telephoned every day over xmas/new year to try and get through or chance they where open. There was a massive problem with their phone system which was clearly overloaded... i eventually got a ring back option and an apology two weeks later.. but when i did speak to someone they told me i was in arrears already!

This was paid via Debit card over the phone and the next month I had sorted the issue with DD (bank couldnt find the instruction). This also appears as a paid arrears on my statement.


I found work with another employer, in another part of the country. I decided i would rent out the whole of my flat to cover bills there while living with my other half who has a flat near the new work. I did the right thing and asked N&P for permission however they refused it. Very frustrating that this would have made my financial position so much more secure.. its almost as if they WANT me to be in trouble! They said i could try and get with another provider on a buy to let.

I have since rented a room out again, which does not require their permission till my fixed rate ends, which it has now.

The main thing i wanted to ask is: now im looking at new deals, and possibly buying a property together with my partner how will this arrears history affect me and to what extent? How long is it till it clears? Anything i can do to improve it further?

Thanks all,

opinions4u

The main thing i wanted to ask is: now im looking at new deals, and possibly buying a property together with my partner how will this arrears history affect me and to what extent?

Six years. Depends on how individual lenders choose to interpret your credit file.

Anything i can do to improve it further?

Pay everything on time. The further in the past your blip is, the happier potential lenders will be.

Check what's actually showing on your file by paying £2 to Equifax and Experian. Don't buy a subscription though.

ACG

As above, you need to get your credit reports.

Then you can give us the exact info and we can maybe help. All the info above probably isnt needed, its just the actual facts/figures that lenders will look at in the main (there are some exceptions).

holly_hobby

3 CLEARED late payments or under in the last 12-18 mths, are generally taken case by case (if everything else is A1) and 2011 is pretty recent. In such cases, the lender will look to establish if the issues were complete financial mis-management/over exposed debt wise, or if there were other factors which could be classed as "out of your immediate control", and your mge conduct before and after the last event.

My own advice, is you need a broker for this, you need their expertise in both knowing how to present it to the lender, and sourcing a possible home, given the other details of the reqd mge, via their lender contacts and BDMs.

This will avoid you trawlling the high st, (possibly) ibeing rejected and having a string of credit searches on your record to boot - which will make placement for a broker so much harder (as the prev seraches will affect any credit scoring lenders).

If you can demonstrate to the lender that the late paymets were errors of a 3rd party, or that the circs that caused them will not reoccur, then that will aid your case .... as I say, although I could give you a few lenders who DONT credit score, I really think that this will be a broker case, spend an hour or so with one this week to see what your options are, they will guide you, and if they find a home for your application, support you throughout the whole application process and beyond ....

If you want to check your file with both experian and equifax for no charge, use check my file, 1 mth free trial (easy cancel over the internet or by telephone) .. here's their link for you ..... http://www.checkmyfile.com/

Hope this helps & good luck !

Holly