Credit and Mortgage, will I EVER get a mortgage? HELP NEEDED!!

alexsymm

Hello everyone,
Any advice would be REALLY appreciated!!!

I have recently applied for a mortgage through a broker (I think he just did a light footprint search) and was refused. It was a joint application with my partner who was accepted. I have my credit file, there are currently 4 settled defaults and 1 default which shows as outstanding, but was actually fully paid off in Feb 13. I have contacted the company and they have agreed it’s their error and they will update it as paid. I am not on the electoral register but have sent the form in to be registered and will be on there from 1stAugust. I have a current account with Barclays that was opened Feb13, I do not have an overdraft on this account and have never been in arrears etc. I also have a credit card with Capital one that I have had since May 2012 with no late payments or arrears, the credit limit is £200 but I have just received a letter stating they are increasing the limit to £400 due to good payment history. I also have a mobile phone with Orange that I have had since April 2010, they have recorded 1 late payment against me but I am disputing that as I do not think its correct, the payment came out via direct debit as usual on the usual date according to my bank. My basic salary is £20409, but with overtime my wage is roughly £32000. Below are the default dates of the accounts on my credit file.
November 2009 – Satisfied
September 2009 – Satisfied (on call credit but Equifax showing still as default)??
February 2011 – Satisfied
January 2010 – This is the one that has been fully paid off but the company hasn’t updated the records but are doing so now.

I also have a Halifax card cash account but this doesn’t seem to appear on my credit file for some reason. There are no arrears / overdraft and I have had this account for about 15 years I think. All the bills at my current address are in my name and there are no arrears or debt, also the rent is solely in my name and there are also no arrears or debt.

I had a CCJ years ago (can’t remember exactly when), but it was fully paid off and no longer seems to appear on my credit file.

My credit score with Callcredit is 453, Equifax is 426 and public (this appears on checkmyfile and it states the average for the nation is 750) is 733.

I am really looking for some advice on how to build my credit score, should I get another credit card so that I can have another account that’s being paid off to increase my rating or a catalogue or something? Also, do I need to wait for these defaults to come off my record completely after the 6 years before I will be able to get a mortgage? Or do you think once the account that is still recorded as default is cleared and I’m on the electoral register, I should be ok for a mortgage? Or can you give me some indication of how long you think I will need to wait before my score will be good enough for me to be approved for a mortgage? Just to let you know the house we are looking at is £160000 new build, we have £8k deposit and would be doing the governments new home scheme. Our combined income between me and my partner is £58k p/a.

Any advice will be greatly appreciated as I have no idea if I will ever be able to get a mortgage or not.

Thank you

Palookaville

The defaults are going to be an issue. Just because they have been settled doesn't mean they will be removed from your credit file. Unfortunately they stay on for 6 years after the original default date.

StuC75

Its more about the timings of the defaults.

You say that for one of these "1 default which shows as outstanding, but was actually fully paid off in Feb 13. I have contacted the company and they have agreed it’s their error and they will update it as paid. "

Are they just updating it to paid - surely if it is there 'Fault' then the default should be removed? or is it just in terms of not updating it that they are at fault?

alexsymm

Sorry they said it was their fault they havent updated it to settled so they are doing that, they are not removing it from my file. Just had a response from Orange and they are taking the late payment marker off my account as there never was a late payment.

No I know the defaults dont get removed just because they are settled, I'm just wondering do I actually have to wait the 6 years for them to fall off my credit file before I can get a mortgage?

Thanks guys

Cycrow

you might not have to wait for 6 years, having 1 settled default from awhile ago wont always stop you from getting a mortgage, but it could effect the rate they give you. But i think it would be best to wait until they are gone. But start to build up some new history if you can before

But as you have quite a few, this would cause problem. But as the last one appears to be Feb 2011, then you have only 3 1/2 years to wait for them too to be gone, so its not so bad.

Keep your credit card and keep up with the payments so when the defaults are removed you still have some history

izools

There are lenders who will lend to those with prior defaults as long as they are all settled and you don't owe much. Don't open any new accounts, this will do more harm than good, just maintain everything as it is paying off your capital one card fully each month.

What the defaults will hamper is the LTV you can get. You're currently looking at 95% which you won't get with adverse credit history.

Either up your deposit to 10~15% or wait for the defaults to drop off.

jacobtheamish

If its the Help to Buy Shared Equity scheme that you are referring to, there are only four lenders currently offering mortgages. They are Halifax, Natwest, Nationwide and Woolwich. You may want to ask your broker to look into each lenders criteria specific to adverse. I think you may struggle unless the defaults are more than three years old, although I'm sure a broker will give more accurate advice.

Good luck

Thrugelmir

alexsymm wrote: »

No I know the defaults dont get removed just because they are settled, I'm just wondering do I actually have to wait the 6 years for them to fall off my credit file before I can get a mortgage?

Thanks guys

Most likely not. However you will have to look after your financial affairs in a far better manner. Get saving as a higher deposit will open more doors.