Help with credit file and ability to take out mortgage

harveybrown2500

When I was at university I took out some credit cards which I endedup missing payments on and ultimately running up bad debts. I eventually paid these off but it has had anegative impact on my credit rating. Iwould now like to buy a house. Thiscredit card debt will be removed from my credit file in 3 months time (it wasnearly 6 years ago) however I have seen a house I like and would like to get anagreement in principle from my bank in order to proceed with it. However will I be able to do this right nowor will I have to wait a few months until this is wiped form my file? Also I am a bit scared to go and speak to mybank in case they turn me down and then this has a further negative impact. I would really appreciate any advice.

Plasma_2

Questions you will be asked on here:

1) How much was the debt for?
2) Did you have a default or CCJ registered?
3) How much deposit do you have?
4) How much do you earn?
5) Do you have any other debt?

harveybrown2500

Hi Plasma,
The debt was around £5000. There was never a CCJ but a default was registered and it has shown up on my credit rating - i tried to get a mortgage 3 years ago and was told to wait a few years until it fell away (which is in a few moths time).
I have a 25% deposit to put down of around £40k. I also earn £40k pa. My only debt now is an interest free overdraft of £1500 which i could pay off with my savings but as its interest free there hasnt been any point.

Plasma_2

Im not a mortgage advisor but have been following these posts for a number of years now, over a couple of different mortgages that i have had. I would say that you are in a pretty strong position, but might be worth going to a broker rather than directly to your bank.
The 25% deposit you have will help, and the fact that the default is so old.

Am sure someone else will be along on here shortly.

Good luck.

harveybrown2500

Thanks Plasma much appreciated.

GMS

If the default is the only adverse credit then there may well be options.

Get copies of your credit reports from Experian, Equifax and Call Credit and get them to a broker. Be careful of applying at random to lenders as too many searches can affect credit score.

harveybrown2500

Thanks GMS will do that

Coyote1811

I was in a similar situation just before xmas. Default due to drop off in 3 months , but found a house we loved. We got a mortgage through Halifax, via a broker with only 15% deposit.

Credit report was excellent apart from the default.

harveybrown2500

Thanks Coyote thats really reassuring to know.
I totally understand its my fault I am in this position but Id be so disappointed to lose out on this house for the sake of a few months.
I think Ill make an appointment with a broker!