FTB with a TINY default trying hard for a mortgage - advice needed!

kristenphill

This is my first time posting here! So hi.

My partner & I have recently (kind of) inherited his grandmothers home. We've been living here ever since she passed as his parents are now the home owners. We're dying to buy but got declined by Principality about 8 months ago.

We're ready to re-apply elsewhere but have a few worries before we do so. Here are the facts;

• The house is worth £115,000-120,000

• We are getting anything above £100,000 gift deposited to us by his parents.
• We have £5,000 of our own money to put down as a further deposit and can also borrow more off our parents to help us along if needs be
• I have a (satisfied) default of £27 from t-mobile on my credit report (long story, not my fault and currently pursuing getting it removed)
• I have £1500 debt at the moment that WILL be paid off by the end of November. My partner has no debt.
• My credit score is 439 and my partners is 840
• I earn £12000pa & my partner earns £14000

So...basically is it even worth us trying for this mortgage again? We've been looking into manual underwriting as we believe my pathetic default and/or my debt and terrible credit score is the reason we got declined. ANOTHER reason we could have been declined is the fact my partner didn't even have a credit score at the time of application. No credit cards etc. He has since gotten a card but pays the balance off as soon as the bill comes through.



Any advice is appreciated. I can elaborate more on the default situation if needs be too.

go_cat

4 x your combined income is only £104000. Hw much can your parents give you ( I say give as mortgage co's dont like loans for deposits )

Would definitely advise seeing a whole of market independent broker

If you do apply wait until after your £1500 debt as dropped off your credit file

Fire_Fox

Welcome! There is no point in having savings when you have debt, pay this off immediately - it will count against you in any application and it takes time from settling for this to show on your credit file. Borrowing a deposit from family is pointless, lenders want no strings funds and (oftentimes) evidence that you can save up.

Your credit scores are largely meaningless, each institution has its own system. Do you have money set aside for all the costs of buying (survey, legals, mortgage application) AND at least three months mortgage payments set aside in case of illness or injury, redundancy or nightmare pregnancy AND funds for repairs and decorating?

Are you registered to vote? Do you both have overdraft facilities and/ or mobile phone contracts that are now well managed? Why do you want a mortgage for £15K to £20K, have you considered a personal loan?

kingstreet

So, this is a purchase at undervalue from a family member, using the difference between the value and the purchase price as your deposit?

How realistic is the value you've mentioned?

Who introduced you to Principality? Have you spoken to an independent or whole market broker?

Don't have any more searches done until you're sure the lender is 99% certain to lend to you...

Slinky

Seeing that you're living in the house already, it doesn't appear to me there's a desperate need to get a mortgage on it NOW given it appears your parents are happy to help you out.

I'd say clear the debt, save up more deposit, try and improve your credit score and wait for a while. Unless there's something you're not telling us, there doesn't appear to be the urgency you seem to think there is.

maninthestreet

As your parents own the property, presumably they will let you live there until you are in position to actually buy it - which you aren't at the moment. Pay off your debts with your savings, make sure every bill from now on is paid on time, and start saving like mad by making 'sacrifices' - that means no holiday next year, for instance.