Can you get a mortgage when you are in a debt management plan?

bob_banana

Hi, I got in about 9k of debt in my 20's through loans, credit cards etc. For the past 3 years I have been in a debt management scheme, with a company (which I am very happy with) and am working toward being debt free. I have about 2 years let of payments before I am fully paid off however my partner and I want to look into buying a house instead of renting.

Can you get a mortgage if you are still paying into a debt management plan? Who should I speak to first? Bank? Mortgage advisor?

We are looking into the help to buy scheme as my partner has the deposit to put down on the house but we want the mortgage in both out names?

Thanks

somethingcorporate

Sorry I cannot help you with your query but who is the company doing your DMP?

If you went with payplan (or a similar type charity) it would be free and all your money would be going to pay back your debt than line the pockets of a company fleecing customers already in trouble.

Good luck with becoming debt free.

Just FYI - if you ever do come into money then negotiate an early F&F on your DMP, we managed to save my brother in law about £1k (30%) by settling his DMP debts early.

G_M

I'm being good.... really... just for once....

must

not

hit

the

smiley

laugh

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must resist...

G_M

Seriously.

Pay off your existing debt.

ValHaller

The only way to do this is to buy in your partner's name while you get your money straight and you get some savings behind you. Once you have reached this stage, you need to do a Transfer of Equity to 'put your name on the mortgage' - and on the deeds. A handy point to do this would be when you remortgage or when you have enough savings to pay off part of the government equity.

BitterAndTwisted

Long version. Look at it this way: you have proven that in the past you have not been able to honour your financial commitments for a relatively modest sum, so what makes you think a lender would be prepared to take a chance on you changing your spots for a sum many, many-times greater than that?


Short version. No ruddy chance!

Guest101

Even if you did manage it.

1: can you afford to pay both and still live
2: the rates are going to be crazy with poor history
3: if you have a deposit saved up, i'd use that to settle the debts

ACG

Im not going to dress this up in anyway... you have no chance and you will struggle for some time to come.

If you can pay the DMP off early then do so, it will go in your favour - it shows you made a mistake and you rectified it as soon as you could and didnt just stick to the minimums agreed.

Your going to struggle for a couple of years after the DMP with a lot of lenders, this will be one for a broker but not until you either have a good 30% deposit or your 3 years down the line after it being paid off.

yorkshire_terrier_owner

Short answer - no.

Like yourself I suffered financial problems, but mine were much worse than yours. I had been desperate to move for many many years. But what I had to do was:

1. Focus on getting debt free. During this time I ploughed every spare penny into paying it all off and saved nothing.
2. Wait a couple of years once I was debt free for my credit reference to clear up which also gave me time to plough every spare penny into savings.
3. Build my credit reference by getting a credit card, doing all my monthly spending on it then paying it off in full at the end of every month.

Eventually, in April this year I moved. I waited 5 years until I was in a position to do so. What it also did was totally change my attitude to money. I've worked hard for it and I'm not handing it over easily. I see so many people desperate to buy property at any cost who then end up in dire straights. PATIENCE is your route to property ownership in your situation.

Also, as A FTB the likelihood of you getting a mortgage in your situation at the moment is remote.