advice - Halifax Mortgage Application

Karrouf

Hello There,

Need some help / advice !
I am currently applying for a mortgage with Halifax and I would like to know what would be my chances to get through. I am working with a broker who got me a DIP. After reading a few stories in the forum I understand that it is not worth much.

A few information about my situation:
I am applying for 80% LTV mortgage on a new build - purchase price - 312,500.
I have been working for the same company for the last 5 years and I have a basic salary of 40K + variable bonus, total gross salary for 2012 was 115,000 and 2013 was 96,000.

I checked my Experian file and my score is fair.
What worries me is that I have a default account dated from February 2009 that I paid off in June 2011 - the default is from British Gas - £90. Something I was not aware of at the time, a debt that came up when I moved house (never received any letter).

The broker is telling me that everything is fine and sounds quite positive but something tells me I may be declined. I am now collecting the information the broker needs (bank statement, payslips, P60)...

What do you think my chances are?

Thank you very much for your help!

Abu-Dina

If the default is the only negative mark on your credit report and you can prove your employment and income (if needed) then I don't see why you should have any problems.

Have you made a full application yet?

Karrouf

No yet, I just sent the documents to the broker needed this morning.
last 3 payslips - proof of address - P60's. Never had loans or credit cards. I am a first time buyer - 30 years old.

There is only the default as negative factor. The other issue I thought could be that I have quite a high variable. I am on the electoral role - been in my current place for 4.5 years.


Is there a chance the application can be declined at later stage?

Abu-Dina

The default would have been picked up at the DIP stage so as long as it's the only negative mark on you credit report then you should be okay IMHO.

At 80% LTV you should be just fine. I know it is very stressful! But stay patient and you should be fine. Once valuation is instructed then you're pretty much there but as they say, it's a done deal only when you have the keys to your new house!

Good luck!

Karrouf

Thank you very much for this - It is indeed very stressful so fingers crossed!

kingstreet

Abu-Dina wrote: »

The default would have been picked up at the DIP stage

Probably not by the Halifax soft search it won't, especially if it was at a previous address.

The only way to know for definite is an AIP with another lender or a full application to Halifax.

Abu-Dina

kingstreet wrote: »

Probably not by the Halifax soft search it won't, especially if it was at a previous address.

The only way to know for definite is an AIP with another lender or a full application to Halifax.

Fair point....

Didn't mean to mislead the OP but from our own experience, Halifax perform soft searches at DIP and Full Application stages. This made me assume that the soft search is not restricted to the number of years searched but by the level of detail?

Anyway, what do I know?! You're the pro, I am merely speculating!

kingstreet

Typically a Halifax soft search for a Mortgage Promise picks up public record information but account information only at current address in the last three years.

When the full application is submitted, the full search picks up the previous addresses and all account data.

Karrouf

kingstreet wrote: »

Typically a Halifax soft search for a Mortgage Promise picks up public record information but account information only at current address in the last three years.

When the full application is submitted, the full search picks up the previous addresses and all account data.

all right then ... different story!

if they do pick up on the £90 default - how big of an issue can it be?

Thanks for your input

kingstreet

If the strength of the rest of your application data is strong, possibly none.

If the rest of your case is weak and the default tips you over the pass/fail line...

With no positive credit record from proper use of credit to bolster your application, you need a good employment record, which you appear to have and a good address history - three years at current address would help.

That 80% on newbuild - is the deposit all from savings, or is any of it builder gifted or shared equity?

Karrouf

kingstreet wrote: »

If the strength of the rest of your application data is strong, possibly none.

If the rest of your case is weak and the default tips you over the pass/fail line...

With no positive credit record from proper use of credit to bolster your application, you need a good employment record, which you appear to have and a good address history - three years at current address would help.

That 80% on newbuild - is the deposit all from savings, or is any of it builder gifted or shared equity?

Thanks for this.

I have been in my current address for 4 years (nothing happened there) moved in in May 2009 - the default was linked in to an account I had with British Gas between 09/2007 -12/2007 in a previous flatshare - the default was registered in Feb 2009, paid it off in June 2011.

deposit is coming from savings (62K) - I would still have enough left for the stamp duty and legal fees.

other that that I am Single, never had loans / credit cards, on the electoral roll since 2009.

Thanks