Question for mortgage advisors

Mlq

Hi

Thanks for taking the time to read my question.

After financial difficulties, I am well on the way to recovering my finances and improving my credit worthiness.

At the moment I have a few credit accounts that defaulted in 2008.
I have agreements with all of these, paying money off every month. As I defaulted the credit agreement, 6 years after the date of the default this will be removed from my credit file. (I will continue paying these even after this date, to settle the balance in full).

My question is, once these are no longer on my file, I would like to get a mortgage, utilising the new goverment incentives.

So am I right in thinking that from May 2014, I will have the following showing on my file:

3 bank accounts, all ran well.
3 credit card accounts, (current combined limit of 3500)
A catalogue account with 100 limit.

My current salary is 25000.

I suppose what I'm asking is, would this make me a likely candidate for a mortgage (this would be a joint app with my partner who is on 40k and a good credit history)

Will the previous defaults be visible in anyway even though they won't be on my credit files?

I know I made mistakes in the past, but as I say I am paying all debts, and have been running all my account ts well for oer 3 years.

Thanks, and I'd appreciate your advice/input.

Dave_Ham

Will be largely dependent upon how this information is being recorded on your Experian, Equifax and Call Credit files.

You could achieve finance now (subject to the detail) with a 15 percent deposit, although for a help to buy with mainstream lender the credit file recordings will be crucial.

Good luck

Crashandburn

Even though the files may be clear by the time you apply, the application does ask if you have had any defaults. It does slightly lower the score by saying yes but just alerts the lender to look for them. As they are so historic, then I cannot see them having an impact.

Dave_Ham

Agreed, but if your credit files are still being marked with an AP this is a big, negative indicator for a lender that automatically credit scores you - which is all of the mainstream/traditional banks..

Good luck

Thrugelmir

Mlq wrote: »

6 years after the date of the default this will be removed from my credit file. (I will continue paying these even after this date, to settle the balance in full).

The accounts will continue to be shown in arrears i.e. default on your credit files. Your profile will not improve until the accounts are settled in full. The original date of default is only part of the issue.

So your incentive is to clear them as quickly as possible not put money aside for a deposit. Being in a payment plan may save interest but does come at a cost, which is your credit rating.

Crashandburn

Dave_Ham wrote: »

Agreed, but if your credit files are still being marked with an AP this is a big, negative indicator for a lender that automatically credit scores you - which is all of the mainstream/traditional banks..

Tell me about it. Contacted Santander about 10 years ago to start making overpayments of £500pm to my mortgage. They duly set it up on the credit file as an 'arrangement to pay'. Nice of them!!

But on reflection, I was never declined for anything with the AP on the file, but sure this reduced the score as you say.

Mlq

Thanks for your responses, most appreciated.

i review my files several times a year. and as the initial accountsd were passed on to lowell's i cant see an AP anywhere on the files (im assumin aP means arrangement plan??).

I ave already had 2 defaults drop off (which im still paying). looking at all agencies there is no sign of them on file anywhere.

im not saving for a deposit, but using all disposeable money towards debt.

thanks again