First time buyers....and i'm in a pickle

poppyflower25

Good evening

This is my first time posting although I have been browsing for a few years.

Me and my partner have seen a 3 bed new build that we love. It has been reduced from £128k to £119995 and has been completed, so it is ready to move into. It has been equiped with a fully integrated kitchen with all the main appliances, carpets, flooring, shed etc. They have reduced the price because they have finished building phaze 1 of the development and need to sell this asap to meet their targets.

We earn a joint income of £38k before tax and our outgoings are as follows:

Mobile phone contract each = £36
I have a credit card with my bank= balance cleared every month and no more than approx £50 (max).
No other credit or children
We both live with our parents and are aged 25 and 31.

We have £20k for a deposit and the money for legal fees etc (please note that the deposit is our own savings as is not gifted from the builder or family)
(15% deposit = £18k)
(20% deposit = £24k)
Now I know most lenders require a 20% deposit on new builds, so I am guessing our £20k deposit could be a problem! (sorry I cannot work out what our deposit is as LTV - I failed maths :embarasse)

(This is where it gets real tricky)

My credit file is completely fine. Not one single late or missed payment ever! My partners is the problem.

1 Default (orange mobile) - default date 5th Nov 2006 for £68 and satisfied straight away. (I know this will expire this November)

Closed Catalogue from 2007 - late payments as follows in 2007:
0 0 0 0 0 0 3 U 3 U 3 3 (was completely fine after 2007 with no more missed or late payments).

Closed Store card (Santander) - late payments from 2007 - late payment as follows:
1 - 12 months 0 0 0 0 0 0 0 0 1 0 0 3 2
13 - 24 months 1 0 0 1 0 0 0 0 0 0 0 0

everything else is completely perfect. There has been no more late payments since the above in 2006/2007. He has had credit cards, 2 lloyds tsb loans and phone contracts and car finance since then which have all been paid on time never missing a payment and cleared / closed over the years. He has no other credit apart from his phone contract now.

I know most people would say wait until the default has expired after November, or save more deposit but we risk the house being sold and missing out.

Would there be anybody who could possibly help us?

I know people on here advise to see brokers but I would not know where to start and who to choose. Non of our family or friends have ever used one. We are based in Dudley West Mids. I have checked broker lisitngs in my area but there are lots of them to choose from.

If it helps we have my partner has been in full time employment for 5 years and me for 13 years. we have been with our banks since we were 16 and have been on the electoral role at our parents since we were 18.

Is our dream home possible or are we completely out of our depths here? We can afford the repayments easy due to our earnings and very little outgoings, I am just worried we will not get a mortgage due to the above plus deposit.

Many Thanks

Poppy

Thrugelmir

poppyflower25 wrote: »

We earn a joint income of £138k before tax
We both live with our parents

Struggling to save for a deposit?

poppyflower25

ooops just realised my stupid mistake it's £38k not £138k (I wish lol)

I earn £22k
Partner earns £16k

Told you I was thick at Maths

llyamah

Thrugelmir wrote: »

Struggling to save for a deposit?

This is a very fair point! How are you earning so much, live with your parents, have so few outgoings (in your own words), and still do not have a more substantial deposit?

You have a 16.6% deposit and would need another £4k in order to have 20%. You could maybe look at getting a personal loan - with your earnings that should not be a problem.

First Direct might be a good one to look at for a mortgage. I recently applied to them for a mortgage with a 15% deposit.

Also, don't be afraid to barter with them - just because they have reduced the price, doesn't mean they will not do so further. If they budge on a further £5k, that's £1k less deposit you would need.

[EDIT - Just seen your reply].

GMS

llyamah wrote: »

You could maybe look at getting a personal loan - with your earnings that should not be a problem.

First Direct might be a good one to look at for a mortgage. I recently applied to them for a mortgage with a 15% deposit.

Dont apply for a loan for a deposit.

llyamah

GMS wrote: »

Dont apply for a loan for a deposit.

In this case I agree; my original comment was meant in the context of the combined income being £138k, in which case a £4k loan would be easily affordable! Then again, in that case the OP should have been able to save £4k before the sale completes!

OP, I would ask parents first. If I could get near to the extra £4k then I would also ask friends.

However, a 15% deposit is doable; apply and find out.

poppyflower25

Hi thanks for the replys and sorry for confusing everyone with my incorrect data of salary. Our parents are not in a position to give us the £4k they have much less income than us

GMS

Speak to a broker. Get copies of credti reports from Experian, Equifax and Call Credit. Be 100% honest with the details.

The default will exclude many lenders so do not apply at random as this could harm credit score.

llyamah

If you cannot get on the ladder just yet, then you might have to wait for a little bit. It might feel like you are missing out, but there will be equally attractive opportunities further down the line.

Dave_Ham

Hi Poppy

As you correctly stated the defaults registered against your partner is an issue and does exclude a large proportion of lenders however there are many reputable lenders that will overlook these providing he has been behaving himself, no late payments, etc, in the last 12 months.

GMS is absolutely right, the first step is to retrieve all 3 credit reports, take a look at a www.checkmyfile.com

A good broker will be able to analyse these upfront and have a good indication on where to place the application. Be sure they take into account the fact the property is a new build as this again will reduce the number of lenders due to the limited deposit available.

Good luck...

poppyflower25

Hi Everyone

Many Thanks to all for your replies. I am really grateful you are all trying to help.

Hi Dave (Thanks for replying)
There has been no late or missed payments at all since those mentioned in my first post in 2007. I have now checked all of the 3 credit references (Equifax, experian and call credit). There are no other missed or late payments on any of them other than the ones I mentioned earlier. (That's 5 years of good credit since the bad credit)
I am completely fine on all 3 of the credit references as well. The default does not show on call credit at all. There is no trace of an orange mobile contract anywhere at all. It only shows the late payments for the store card and catalogue and these match up with experian and equifax. I wonder why that is?

The default is due to expire on the 5th November this year (11 weeks away). Should we do the sensible thing (even if it means losing the house) and wait until the default has dropped off the file?
Thanks Poppy