Bankrupt and wantong buy a home

stickyvikki

Hi,

I have not visited MSE for a few years. Since my last posts I have been in full time employment for over two years working as an Accounts Clerk. In this short space of time I have been promoted and gained multiple payrises.

I have getting engaged and live with my partner in a one bedroom flat rented from the local Housing Association/Council.

Sorry if I seem to be dragging this out, hoping there is someone who can help us!

My partner has lived here for 5 years and rented from the Council for nearly 15 years now! We are currently on the waiting list for IVF treatment in order for us to have a family of our own.

We are wanting to move into a house in order to live as a family in a home for life but unfortunately we are hitting many obstacles on the way.

Heres the crazy bit..

My partner is a self employed taxi driver who pays an accountant once a year to process his accounts. I am into my third year of being discharged from Bankruptcy and have no debt and very minimal outgoings now.

I earn £18.5k pa and my partners varies between £12k and £20k obv depending on work. My partner has the right to buy on the flat and has been given the maximum discount only thing is he cannot get a mortgage based on his employment and I cannot go in on a joint mortgage with him as with being bankrupt you do not qualify for the discount. On the negative side of the discount is we cannot sell or rent out within 5 years or we will have to pay back the percentage of discount given. With us trying for a family this does not make the better option.

We have spoken to Council who have advised we cannot have a house on the basis of starting a family I have to have given birth and then it could take two years as they say that with one baby we would be adequately housed in a one bedroom flat until the child was two.

We have never fallen behind a payment on the property and all our bills are paid on time.

Straight to the point (Sorry for the waffle just want to give a clear idea of who we are and what we are needing).

We would like to look down the route of buying a house but know that we face a massive brick wall given the circumstances I am on MSE to see if there is any advice anyone can give us to help us try and get a mortgage and point us in the right direction before we start to get excited about the prospect of owning our own home.

Again sorry for waffle hope it hasn't put you off and there is someone who can help please

Thrugelmir

Are you saving regularly at the moment?

stickyvikki

Hi.

Yes we have manged to save a few thousand up not the necessary 25% we have been advised we will need but we are saving every spare penny we have the average house price where we live is £130k and we have seen a lovely little two bedroom house under that for £113k. We have toyed with the idea of privately renting but that would end up leaving us no money to save for a deposit and never get us on the property ladder.

I have worked on our pwn cash forecasts and can comfortably afford a base mortgage of £600 per month before all your water etc..

V

Dave_Ham

Ok - lets see if we can help..

What deposit have you saved?

What is OH credit file like and do you specifically know what income was put through for last 3 years?

Dave_Ham

Just re-read, unsure why OH cannot get a mortgage due to being a self employed taxi driver.

Although I recognise the need for a house, the purchase price (real price) for your flat must be incredibly low if £75k discount is applied??

stickyvikki

Hi DaveHam.

We ahve managed to save £10k not alot but suppose it is a start!

The value of the flat is £70k and we were offered £28k disc that being the maximum for our postcode.

Unfortunately my partner has been putting books thru of £7.5k earnings after all his outgoings i.e Car, taxi rank petrol tyre etc.. The true figure because it is cash in hand os obv a little higher but hard to track as he has a tendency to buy bait and fancy tyres for his car.

My credit check is showing very good and all my past debts are now showing satisfied my partners is good and showing all bills paid on time.

Thank you for your help means a lot.

V

Dave_Ham

I think you may be able to get close on the sole name Right to Buy, although exact figures and commitments would be required before specifics..

What date was you made bankrupt?

agrinnall

Banks don't care who you are, all they are interested in is the data - how much money are you making, how much are you saving, what debts have you got, have you got any black marks on your credit record, etc. All you can do is improve those things as much as you can, and maybe see an independent mortgage broker to see if they can suggest a suitable product for you.

I hope your partner is declaring the 'cash in hand' element of income to the tax man, having HMRC on your back is not going to help your chances of getting a mortgage.

stickyvikki

I was made bankrupt on February 2010 and discharged July 2010.

My partner has raised the suggestion of buying the flat with the councill discount if he can use both our savings as the deposit on a buy to let mortgage if that is allowed and using the flats equity est to be around £28k as a deposit on a second home joint with myself is this possible or just pulling a strings?

Hi Agrinnall, yes we are in a rut with the situation but I have come on MSE not to be criticised but to ask for genuine help sometimes you need that off the record help. I thank you for your post and totally agree with you we are just looking at ideas and help in the comfort of our own home to help us answer all the questions we have. Yes my partners declares all his income unlike a lot of people in the UK and pays his tax and NI bills so we will definately not have any Tax man at our door.

Dave_Ham

No chance I am afraid, buy to let will not be an option for a variety of reasons.

Depending upon the exact specifics of income and commitments and + your joint deposit the right to buy looks like your best solution on offer.

stickyvikki

Thanks Dave I was afraid that would be the option it is a fantastic situation we are in with regards to the discount and many people would be screaming at us and mad that we would not think of taking it I am just afraid we will have to stay put in our flat for the five years altho it might be ideal for some families I think we will find it extremely difficult with a dog a baby and both my partner and I working split shifts. Everything is so frustrating as we know we could afford the mortgage on a bigger property oh well doesnt always pay to be a child of the 80's lol Thankyou for your advice