Mortgages for ex-bankrupts

Bassplayer

Hi all

It's been a wee while since I was last on here but found it an incredibly valuable resource when my financial hour was at its darkest. And I'm back today for some of that experienced, forthright advice I know I'm gonna get!

So here goes...I was made BR in May 2009, discharged in February 2010 (for good behaviour presumably!) and I'll have been renting this flat for four years in the spring - that equates to about £32K to my landlord, who to be fair has been fair.

Anyway, with my income gradually improving year on year since BR and that terrible time fading into the past a bit, I wondered if anyone knew of any bank/building society/A N Other who would be worth talking to about a mortgage?

I know times are tough out there - even for those with tidy credit records - but I live in hope.

Any advice gratefully rec'd. Thanks and very best wishes everyone.

Kevin

PS: Just realised that this new thread/question has probably been raised many times before, so apologies for that.

tigerfeet2006

It certainly is possible but you will have to put down a hefty deposit and will most likely be on a higher interest rate. The further away your BR is the easier it will be to get a mortgage. Also if ever you are asked have you ever been BR, then you have to say yes.

Check out this thread by Lorax
https://forums.moneysavingexpert.com/discussion/2918012

droiderm

It's worth making clear, that some lenders will NEVER lend to an ex bankrupt.
From my research it seems that that are few that will, nationwide being one. Some building societies will too.
The bigger the deposit, the better the chance. I think 20% is the quoted figure, but obviously that's not set in stone.
I would also make sure that your credit report is clean. Don't miss any payments.

I was discharged in feb 2008. We have a 5% deposit which isn't going to happen, so we may just go in my wifes name.

What time scales you thinking? What size deposit do you have?

foolishboy

Just had a mortgage approved (in principle) with Halifax, I was BR April 2008. Went through a broker, Nationwide considered me but rejected me after referral.

FB

droiderm

What size deposit did you have?
I would be careful that a mortgage in principle isn't worth too much

droiderm

Just checked Halifax don't lend to ex bankrupts.

lucy03

droiderm wrote: »

Just checked Halifax don't lend to ex bankrupts.

They do in some cases, I have a client who was made bankrupt in 2010 and was given a mortgage this year with the Halifax. I also know that Barclays do, but the two I've seen from recent bankrupts were approved by a business manager as they were self-employed, so they may need special approval internally.

droiderm

Halifax clearly say they don't lend to ex bankrupts.
I am pretty sure barclays do too.
If your a broker why would you try to place your clients with 2 lenders which in 99.9 percent of cases they wouldn't lend?

Bassplayer

Hi guys

Thanks for all the help and advice, practical and to the point.

My long standing partner owns her own place which sadly isn't big enough for us both to live in (especially as we have four daughters between us who stay with us from time to time!), plus I work from home. However, she has got a hefty £150K of equity in it.

Our plan at mo is for her to sell her house and clear her small mortgage, and use the £150K as a good deposit, which (I think!) should give any lender plenty of cover and confidence.

I'd then try to get a mortgage for as much as possible to add to that and be responsible for paying it. Even a mortgage of £100K plus would be cheaper for me to pay than my current rent.

In terms of timescales, the last of the four daughters goes to Uni next September (2013), so it seems likely we'll get serious about a move to at joint home then. By which time I'll be 3.5 plus years from discharge.

I'm surprised to learn from you guys that mainstream high street names are in the frame for a possible mortgage - that's good news, it will help me to stop feeling such a financial leper!

I think early next year I'll maybe start the ball rolling by approaching a couple of brokers, who I'd guess would need to be specialists in debt/BR applicants? If anyone has any ideas on such brokers, a heads up would be most welcome.

My main concern in all of this is to keep my lady's equity safe for her and her girls should anything happen to our relationship or me - but I'm sure the lawyers have covered that base before!!!

And also to keep her name and mine financially separate for as long as possible.

The other thing I'm thinking about doing is to apply for one of the credit cards guys like me seem to be able to get to help rebuild our ratings.

Sorry, I've gone on haven't I? Thanks again for all the help.

Best wishes all

Kevin

kingstreet

droiderm wrote: »

Halifax clearly say they don't lend to ex bankrupts

The Halifax criteria must have changed recently, because the last time I looked, it simply said "discharged for one year and subject to credit score" or something similar.

I've opened a thread on M&E to see if any of the other brokers noted the date it changed.

lucy03

droiderm wrote: »

Halifax clearly say they don't lend to ex bankrupts.
I am pretty sure barclays do too.
If your a broker why would you try to place your clients with 2 lenders which in 99.9 percent of cases they wouldn't lend?

I'm not a broker, just happened to be involved in some legal work where this proved relevant.

If the two guidelines of (i) there is a good deposit being paid, and (ii) there is clear evidence that the individual can afford the payments, then I certainly think it's worth popping into the banks directly to ask them whether it's worth pursuing an application (or asking an intermediary to give advice).

My point in general was not that you'll easily find a mortgage with a bank under such circumstances, just I personally wouldn't rule them out. I don't know about the Halifax, but I know that Barclays were helpful in setting out what sort of deposit they'd need to consider authorising such a mortgage.