help me move on!!

hotchili

Hello all,

Would love to hear some good advice from you lot.

I am currently living at home with my parents after my previous relationship broke down. I have a daughter aged 4 too. As I am living at home I am managing to rack up the saving and also have minimal outgoings.

I earn £30k per annum, receive approx. £8k per annum from child maintenance etc. My outgoings at the moment is just my mobile phone bill and general outgoings and nursery fees for my daughter.

I have managed to clear all my previous debt with the except of 1 credit card with a balance of £2k. This will be cleared within the next 2 months. I do have previous defaults with the most recent within the last year. Also some of my debt accepted a !!!!!! figure for less than the amount I actually owed.

I am looking to purchase a house for myself and my daughter and have a deposit of approx £50-£60k. I would ideally like to borrow £150k. Let me know if this appears high?

I am very nervous about making my first mortgage application on my own because of the fear of being rejected and affecting my credit rating even more. At present my experian score is 999 (but I understand this does not play a part in a decision from a lender).

Just to recap:
salary £30,000 per annum
maint. £8,000 per annum
want to borrow £150k
Deposit £50-£60k
1 credit card and no further debt
previous defaults

Is there a preferred lender I should approach and will any main stream lenders look at me? I am desperate to move on and make a home for myself and my daughter and worked really hard to clear debt and save. I have the income to cover a mortgage payment comfortably but my past may prevent this.

Can anyone help or guide me in the right direction?

Many thanks in advance. xx

ACG

You might get it with a high street lender but you might not - the deposit is potentially the saving grace here.

Is the maintenance court or CSA ordered? If not then you may struggle to get that included, i think really you are looking to stretch your income and this is probably one for a broker.

hotchili

my maintenance comes direct from my partner every month as per a legal agreement.

No CSA involvement at all. Will this affect anything?

I am very nervous about going to a broker, just worried they will look down at me because of my previous debt

ACG

If its not court or CSA ordered the majority or lenders will not allow it (there are exceptions). If you go to a lender who will not accept it, then you will find your income isnt enough for the amount your looking to borrow.

If a broker looks down at you for debt or any reason, then its time to move on to another broker. To be honest its probably more in your head than anything else - we see all sorts of weird and wonderful scenarios.

macarena123

A broker won't look down their nose at you - their job is to get mortgages successfully placed, so they have an interest in helping you

And I don't think you have anything to be embarrassed about - debt can happen to anyone, and you've done brilliantly getting to where you are now

I honestly would encourage you to meet with a broker - if your case is a bit challenging, they can give you an honest opinion and you will likely have more chance of success via them than going it alone

best of luck!

hotchili

thats very reassuring, thank you. I live in a city in where prices are very high so you do not get a lot for your money.

I think from your advice i just need to pick up that phone and see a broker! Do you think I will likely have to go to a mortgage lender that specialises in bad credit and I presume they do not like to lend you a lot!?

macarena123

Yep, you have nothing to lose by picking up the phone

In terms of the lender question, I'll defer to ACG or one of the other resident experts on that one....

ACG

I wouldnt want to say.

I would suggest you get all 3 credit reports (equifax, experian and call credit) and see a good broker, it could be possible to get you a mortgage with a high street lender but without knowing all the info its difficult to say.

All lenders (even adverse ones) have affordability calculators on what they will lend you so it might be possible to get what you want, but there might have to be some give somewhere - either on the amount you can borrow, the deposit needed or the rates available.

(By good broker, your best to avoid an estate agent based broker, as they tend to deal with run of the mill all day long).

serious_saver

I can only share my recent experience with you

- No previous debt apart from credit cards which are paid off in full every month.
- £50,000 deposit
- My partners income £19,000 income
- My income couldn't be counted as I was a contract worker despite easily being able to afford the repayments

We tried ourselves and couldn't get a mortgage at all because they would only accept one income but doubled our outgoings on the affordability. Despite the deposit and lack of debt we just weren't considered a safe bet. Then we visited a broker and we were offered 1 mortgage by 1 provider which only deals with brokers (so we couldn't have found it ourselves.)

The broker was fabulous. He didn't look down on us at all. Just think about it, brokers make their money from commission so it's in their interest to get you on side.

It cost us £495 for the brokers arrangement fee but we had planned for that. And after all it's not like we were having any success on our our own!

The result . . . we now own a lovely 2 bed semi-detached house which cost £133,000 (plus fees and stamp duty.)

We're paying £430 per month on a repayment mortgage as opposed to £700 per month on a rented flat

What I'm basically saying is don't rule out the broker if you're struggling elsewhere but like anything else shop around to find one you are happy with.

hotchili

thanks so much for sharing your situation with me, great story with a super ending. I think i am just going to go for it, push the shame out the window and get on with it!

Although there is negatives there with the debt there is also positives with deposit and outgoings etc.

I think i will organise this asap and come back to tell you how I got on.

thanks again

monty-doggy

I am sure this is correct, but CSA cannot be taken into account because it can be variable.

If your ex comes out of work, or moves into a lower paid job, or has a child with someone else, then the amount of money he gives you is reduced.

Don't just apply for it as you will damage your credit file.

Have you thought how you will afford it of any of the above happened?

Also I'd pay off your debts with your savings if you've had defaults. It will look better for you owing nothing.