Mortgages for defaulters?

moohound

I have 9 defaults on my credit file for unsecured debts. My husband has a clean credit file. We have a joint mortgage with 9 years to go, we have never defaulted on any mortgage payments.

I am in the process of making full and final payments to all my creditors and will be free of unsecured debt in a couple of months.

Would it be worth then applying to remortgage? My husband has made some enquiries and we could save £140 a month if we could switch.

I don't want to go through the process of applying if I have no hope of being accepted.

My husband has £9650 in an ISA.

We have £54000 on repayment and £40000 on endowment. Our house is worth £160000.

He earns £38300 and I earn £30000.

ACG

Its unlikely you will save money, im not judging but 9 defaults is pretty bad - most high street lenders probably wouldnt accept you.

It could be possible to get a mortgage depending on how long ago the defaults were registered, but you wont be on a market leading rate.

Thrugelmir

You are going to need some years of clear history before being considered for mortgage finance.

Not least because you've not repaid your debts in full. So lenders are going to be adverse to lending you more money.

To save money. Overpay your mortgage and pay less interest.

moohound

The defaults are a few months old if this makes any difference. I would gladly put it in his name only to save that amount of money,but I don't think that's possible.

As you may be able to tell I don't know much about mortgages:o

I think I will start overpaying what I used to pay on the debts, that is really good advice, thankyou:D

ACG

A few months... very unlikely.
What interest rate are you currently paying what deal are you looking at?

How much do the defaults come to in total?

moohound

Defaults were summer last year, total defaults the £39000 on my signature. Is a long complicated story, that I won't go into here.

Current mortgage with Skipton paying £900, husband was quoted £760 by HSBC.

We don't want to increase the size of the mortgage, just get a cheaper deal.

If they are going to reject me, I won't bother, I would find it too stressful. I will start overpaying as suggested instead. By the time my defaults drop off we will only have 3 and a half years left until it is paid off.

ACG

Dont bother. I do know lenders that would look at it after 2 years at a rate below 4% but at £39,000 i think even they might have to think twice.

To be honest, i would say until they have dropped off your credit file, you probably stand little chance of getting anything main stream.

kingstreet

Ask Skipton if it has a customer retention product you could opt for. This may reduce the rate you are paying and such products are normally offered without further checks.

A remortgage may be possible, but the rate will be higher than your current rate, and therefore pointless.

moohound

Thanks, we will look at what Skipton can do for us, I when these are all clear, I will be in the best financial position I have ever been in and yet can't move my mortgage, I'm not complaining, it just the way it is, oh well I'm just glad to be debt free soon really.

Annisele

Don't feel too badly about the fact you can't have HSBC's rate - most of us can't!

It is one of the pickiest lenders around. It has great rates, but that means it can carefully choose only the borrowers it really wants.

ACG

Im not judging as there are reasons for whats happened, but you have 4 full and final settlements and 9 defaults.

Banks are not just going to ignore that, you havnt actually cleared your debts in full, the lenders have just accepted a lower figure to get you off their books. You need to show you can be responsible with money and that wont happen overnight. Because of the seriousness of it, its going to take a good few years.

As Annisele says, i would forget HSBC. I imagine they would decline me for a mortgage also and my credit history has 2 late payments in it - i wouldnt even waste my time trying them.