Stalled mortgage application.

vien

This might be a long one!

We have found a great house, empty, perfect for us, seller happy to sell to us. We currently have a flat that is great but just a bit too small so we are ready to move in. The market around here is not exactly speedy so we had intended on releasing enough equity from this place for a 10% deposit on he house and renting the flat out. This would mean we had about a 60% ltv mortgage on the flat.

We previously took out equity in march this year for home improvements which the bank were more than happy to lend to us at the time.

So we started the process of doing it again, having previously had an agreement in principle based on our income and rental plans. But we've been knocked back. Now I know what it is - I checked Equifax and it is because my partner had a court judgement made against him that was settled in 2010. We had previously known this (obviously) and he had a lengthy battle with them to get it recognised as settled in late 2010. It does say settled now and that is the only thing, literally the only thing, bad in there.

So I don't really know where to go from here. They obviously won't take that off until it expires (March next year). Is it worth trying another lender who don't use Equifax? Or is it just a case of waiting it out?

And I'm most annoyed that this didn't apparently matter when we applied in March!

Any advice appreciated

kingstreet

A CCJ remains on a credit file for six years from the point of registration. It's a problem for most lenders, satisfied or not.

I suggest you obtain copies of all three of your credit files to establish exactly what you're up against and take them along to a meeting with a good independent or whole market broker.

It's possible your lender was happy to lend more for home improvements but not to make the property non-owner occupied which would make it more risky for it.

Presumably not only do you need a mortgage for the property to be let, but for your onward purchase too? You'll also have a problem with that, particularly at 90%.

vien

Thanks for the reply - it's along the lines I was thinking.

Have got 2 out of 3 of the reports - Experian is excellent, Equifax is poor and it is literally this one thing on it.

Thanks for the tip about the mortgage advisor - there seems to only be one independent/whole market one around here so I'll give them a ring. It seems probable now that we'll have to put the flat on the market which hopefully means the house will still be there when it sells!

Thanks again.

vien

Ps, I realised I should have put this in mortgages this morning

kingstreet

vien wrote: »

Experian is excellent, Equifax is poor

The CRAs opinions are worth nothing, I'm afraid. They do not lend the money.

Lenders are looking at a bigger overall picture than what the CRAs provide. There have been many threads on the M&E board about borrowers who thought they would automatically get a mortgage because one CRA gave them "999."

It's important that you know exactly what is showing on all three files, as they can vary, with some firms supplying information to only one, or perhaps two of the CRAs.

The £2 paper files are fine for this purpose and you should complete the picture by obtaining yours from Call Credit.

https://www.callcredit.co.uk/stat-report-online/index.php?action=register_display&tpl=regPurchase