£42 default on credit rating

mattsday

Hello,
I am in the process of exiting the rental trap and joining the housing market! To ensure there were no surprises I ran a credit check...

Anyway, the short story is that I have a £42 default from T-Mobile, which I think happened when I moved house 3 years ago... I never got a letter or anything, but it's likely it was overlooked during that stressful time.

The default is listed as being placed in April 2012. In your experiences, will £42 stop me from getting a mortgage?

1. I have an excellent history with HSBC (my bank) and a good credit card limit + overdraft limit with them
2. I have never had any other issues with payments etc
3. I have a full-time job and a high income (£90k+)

I'm seriously stressed and worried that my long-term plans are going to be completely destroyed by this one poxy mistake

Any advice or experience would be very warmly welcome.

ACG

HSBC are very unlikely to accept you.

However, you dont say how much your looking to borrow and how much your deposit is - that will be the key.

GMS

How much are you looking to borrow? What is the purchase price?

HSBC are the pickiest of lenders. I would be surprised if they allowed the default, however small.

mattsday

Apologies - I was looking to use the Help to Buy scheme. The property is £209k and would look for a 75% mortgage at £157k (deposit being 41.8k equity loan, 10.5k mine).

Ignoring HSBC as a lender, do I have any chance at all? I'm feeling very disenfranchised!

I'm working with a mortgage broker and haven't told her about this yet (only checked my credit report this evening). However, am I wasting my time in even trying to get a mortgage?

GMS

Tell your broker asap. No point in applying to a lender who will decline.

See what the broker comes up with.

ACG

This is going to be quite difficult as your limited on lenders with help to buy.

I would agree with GMS, speak to your broker.

mattsday

Thanks for the advice - it upsets me a lot that people with far worse finances than myself get mortgages, but because I made a silly oversight 3 years ago, I can't get credit . I take it there's no making the banks see reason in my thinking?

demontfort

It's more worrying to me that you earn £90k plus and can only chuck £10k of your own money in as a deposit. That would suggest that either you don't want to stump up your own cash or are useless with money. On that type of salary for a £200k house you should be looking at a 50% LTV.

mattsday

demontfort wrote: »

It's more worrying to me that you earn £90k plus and can only chuck £10k of your own money in as a deposit. That would suggest that either you don't want to stump up your own cash or are useless with money. On that type of salary for a £200k house you should be looking at a 50% LTV.

You know nothing about me, my finances or commitments to say the least. I have more than doubled my salary in the past 3 years, so it's not like I've had loads of opportunity to save - not to mention that I was supporting my gf who was unemployed for a long time.

With the 10k + 40k equity loan I can OWN a property for 5 years whilst saving the 40k to pay off at the end - not waste money on rent... You think it's a better idea just to continue renting until I can afford a 25% deposit? That'd take years...

gazter

mattsday wrote: »

Hello,
I am in the process of exiting the rental trap and joining the housing market! To ensure there were no surprises I ran a credit check...

Anyway, the short story is that I have a £42 default from T-Mobile, which I think happened when I moved house 3 years ago... I never got a letter or anything, but it's likely it was overlooked during that stressful time.

The default is listed as being placed in April 2012. In your experiences, will £42 stop me from getting a mortgage?

1. I have an excellent history with HSBC (my bank) and a good credit card limit + overdraft limit with them
2. I have never had any other issues with payments etc
3. I have a full-time job and a high income (£90k+)

I'm seriously stressed and worried that my long-term plans are going to be completely destroyed by this one poxy mistake

Any advice or experience would be very warmly welcome.

Contact T mobile about the default, explain that you werent aware of debt, moved house etc, pay it off and ask if they can remove the default from your credit file. They can.

Thrugelmir

mattsday wrote: »

You know nothing about me, my finances or commitments to say the least. I have more than doubled my salary in the past 3 years, so it's not like I've had loads of opportunity to save - not to mention that I was supporting my gf who was unemployed for a long time.

With the 10k + 40k equity loan I can OWN a property for 5 years whilst saving the 40k to pay off at the end - not waste money on rent... You think it's a better idea just to continue renting until I can afford a 25% deposit? That'd take years...

The scheme is geared to weed out those that can afford to save for a deposit, or a buying a cheap house.

On your salary raising a 10% plus deposit shouldn't be an issue.