First time buyer advice

Firsttimebuyer1985

Hi guys,

My wife and I are currently renting and looking to buy our first house. She has an excellent credit rating (experian 982) and I have a good rating (experian 953). We are both in full time employment and have a joint annual income of £60,000 and currently pay £800 per month in rent.

We have around £26,000 saved up for a deposit and are looking at houses around the £220,000 mark.

My concern is my credit history. I have 2 satisfied defaults on my credit file. These accounts defaulted back in early 2011 but my recent payment history is fine and my credit score has increased each month to the point it is now bordering on excellent.

My wife has £4,000 of current debt and I have £3500 which we have been advised we wouldn't need to pay off before applying.

Before we go making any offers, do you think it will be possible for us to get a mortgage in this situation?

I appreciate we are looking at 90% LTV so will have higher interest rates anyway but we are tired of throwing money away renting as we could very easily pay a mortgage of around £1250 each month.

Thanks in advance!!

R_P_W

Why do you have that debt and savings?

Firsttimebuyer1985

We recently got married and so some of the debt is from that and I have some outstanding on a car. If we pay it off we won't have he 10% plus fees needed. As we were already advised we wouldn't need to pay it off we thought we might as well keep the deposit for the house fund.

opinions4u

The defaults will make getting a high LTV mortgage difficult.

Find a reputable local broker to assist, but be prepared to save a 15% deposit plus fees and stamp duty etc. this will open more doors.

If any of the existing debt is a credit card make sure you are paying more than the minimum payment.

She has an excellent credit rating (experian 982) and I have a good rating (experian 953). I have 2 satisfied defaults on my credit file

And this tells you how useless the Experian random number generator is. Defaults are not "good" or "bordering on excellent" when it comes to borrowing money.

Firsttimebuyer1985

Thanks for stating the obvious but I never claimed a default was 'good' that's just what my rating is listed as which most lenders use.

The defaults are nearly 3 years old and I know from reading online some people have been able get a mortgage in a similar situation to myself.

Can anyone in the north kent area recommend a good local broker?

Yorkie1

Firsttimebuyer1985 wrote: »

Thanks for stating the obvious but I never claimed a default was 'good' that's just what my rating is listed as which most lenders use.

The defaults are nearly 3 years old and I know from reading online some people have been able get a mortgage in a similar situation to myself.

Can anyone in the north kent area recommend a good local broker?

You are wrong on the highlighted bit.

Lenders don't have any regard whatsoever to the 'score' that a credit reference agency gives you. They use their own internal scoring processes and defaults can be highly relevant to those processes. The CRA 'score' is of no relevance at all in this situation.

opinions4u

Firsttimebuyer1985 wrote: »

Thanks for stating the obvious but I never claimed a default was 'good' that's just what my rating is listed as which most lenders use.

Where did I say you made such a claim? I was explaining to you that the numbers offered up for a fee by credit rating agencies are useless.

The lenders don't use the numbers. They use the factual information and make their own assessment.

The defaults are nearly 3 years old and I know from reading online some people have been able get a mortgage in a similar situation to myself.

Good luck. I'm sorry you didn't consider my post useful. I'll let others see if there's any point offering suggestions when you already know everything.