Mortgage after IVA

fluffpig

Hello all,

First time poster here hoping to glean some advice from the experts/experienced:)

Im just in the process of daring to think about the possibility of buying a house, but want to know how realistic this would be in my circumstances having previously been in an IVA.

Stats as follows..

20k deposit saved (so far) and looking to purchase a house up to about 130k in value

Annual salary of 30k (same employer for 15 years)

Credit files (all 3) now completely clear of any adverse history

No dependents/loans/outstanding credit card balances (I have 2 credit cards but both are paid in full each month)

Im on the electoral register and have reduced the credit limits on my cards/catalogues so that I dont have huge amounts of available credit to rival any potential mortgage payments and have financially disassociated my self from my ex partner

I cant think of anything else I can do now to make me look an attractive prospect to potential mortgage lenders, so the stumbling block will be the IVA which was taken out in March 2006 and came off my credit files in March 2012

I guess the question is, If I found a house I wanted, would I be able to get a mortgage now with a 15% deposit given the above? Ive been told informally by a mortgage broker that I would need 20% at least:(

Any advice from those in the know or have experienced similar would be great :T

kingstreet

I'd say if your credit files are clean, a 15% deposit will be enough. If you want a "high street" rate such as HSBC offer you may have to wait longer, but I could do this case with a local building society, if it was one of my clients, with no problem.

A broker should be your first port of call for this. Avoid speculative credit searches to try to save yourself 0.5% which end up with multiple footprints on your credit file and no mortgage!

manzanilla

Only other thing that comes to my mind is whether you have any car finance?

Apart from that, with a 15% deposit you should be fine.

Well done for digging yourself out of debt and into such a good position!

fluffpig

Thank you both!!

No I dont have any car finance and Im hoping my current little car will last another couple of years )

Its good to know that Im not chasing the impossible dream... I'm getting bored of living off beans on toast after 4 years of hard saving lol

Thrugelmir

fluffpig wrote: »

Its good to know that Im not chasing the impossible dream... I'm getting bored of living off beans on toast after 4 years of hard saving lol

The larger the deposit you save the better. Interest rates aren't going to stay this low for ever. So as it tough as it might seem. Well worth the effort.

fluffpig

Thrugelmir wrote: »

The larger the deposit you save the better. Interest rates aren't going to stay this low for ever. So as it tough as it might seem. Well worth the effort.

I totally agree!! Just two things are making me wonder whether to buy now if it were possible
1, Im now 40 so the clock is ticking if I want an affordable mortgage term
2, Im bothered that house prices will start to rise now the government
'help to buy' schemes are kicking in and I will be forever chasing a moving goal post.

Kingstreet, just out of interest, would the building society you have in mind charge higher rates because of the past IVA or is it just that their 'normal' lending rates are higher than the big high street players?

kingstreet

Smaller, local building societies don't normally charge more than their standard rate and often have discounts and fixed rates available. However, as they rely more on retail deposits to fund their mortgages they are often not as "keen" as the bigger players who are currently using the Government's FLS to raise money at 0.75%.

The net result my be around a 0.5% interest differential for the next couple of years, then hopefully you are in a position to consider a remortgage onto the national high street.

IIRC the last case I did was at the building society's SVR, 4.99% but that was for high loan to value, shared ownership and with adverse in the last three years, although not serious adverse.

amnblog

fluffpig wrote: »

I've been told informally by a mortgage broker that I would need 20% at least:(

The broker is right, keep saving.

fluffpig

amnblog wrote: »

The broker is right, keep saving.

Ok...now i'm confused;)

I know in reality that the larger the deposit the better...and also possibly the further back in history the IVA becomes the better, but I know that if i'm getting back on the property ladder it needs to be in the next year or two...

Would a 20% deposit open up that many more avenues? I can live with saving for another year if it does...but if it then becomes 25%+ I think I need to be realistic and resign myself to the inevitable