Bad credit partner

confused-home-wanter

Hello all,

Long-time-lurker on the forums, so would first of all like to say thanks for the invaluable advice I have used over the years.

My partner and I are looking to buy a house. Both first time buyers.

I earn ~£27k, and Other Half (OH) earns ~£32k. We are looking for a 2 bed place in London, and realistically around the £250k mark (crazy I know!).

Our main problem is OH has v bad credit rating and wouldn't get a mortgage, but can contribute to the mortgage repayments ~£700/month. (I have no credit issues at all and a good history)

We have a generous (retired) family member who could help with both the deposit (to be payed back as/when we can afford it) and obtaining a mortgage.

Question: Is it possible to get a "joint ownership" mortgage with someone who is retired, in order to allow us to secure a larger mortgage, basically leaving the OH out of the picture?

The two main reasons behind this are:
1- we don't really want to pay the £1400/month rent we would have to pay and
2- we would ideally like to build our own equity in the property.

Thank you all in advance for your help.

Dave_Ham

Hi,

This is going to be hard work whatever way it is cut.

Given the income required, really need to know more about OH credit, as even with his income it will be tight..

Have you got his Experian, Equifax and Call Credit reports and exactly what is showing on there?

confused-home-wanter

Hi Dave,

Thanks for your quick response.

After having a hunt around we could find a 4% mortgage on £200k, the repayments would be ~£1000/month- saving us £400/month and paying into our own home.

Haven't dared to get CR at the moment as we are still waiting a few months for the 6year mark on some hotly disputed debt.

Is there no way we can avoid OH in the process and have my income plus family member as the people who will pay (on paper) but in reality me and OH will actually make the repayments?

Dave_Ham

Sorry a bit confused (and a tad tired)

Where have you seen a 4 percent deal for your circumstances?

Please get his credit files, you can only attack this when you know what you are up against and he has listed.

What percentage deposit do you have?
Where has the deposit come from?
How old is the family member you refer to and do they have an income?

confused-home-wanter

Sorry for the confusion, I probably didn't word it the best way.

The 4% was on the post office- actually works out to 4.2% (after initial discount, then increased rate).

We don't want to look up credit files as we don't want to "rock the boat" in that respect...

We have up to around £50k as a deposit, and haven't seriously started hunting for a place because we weren't sure what our options are yet (hence this).

Deposit is from retired family member, who is willing to lend it to us indefinitely, but would eventually want it back, either when we sold the property or when we could afford to re-mortgage etc.

Family member is 84 I think. Only income is from savings and investments.

My point was I wanted to avoid OH on the mortgage altogether.
Debt is ~£20k of credit/store cards due to the ex, which hasn't been payed off in 5 years.

Does that make things any clearer?

Dave_Ham

Thanks, loads more sense.

Bad news is that this is no way practical or feasible.

You need your OH income and only way it can be done is with him on the application, although the 5 year unpaid debt will not help.

I do not think this is going to be practical, but difficult from a public forum so you need to sit down with someone and run through it all thoroughly.

Best of luck

confused-home-wanter

Ok Dave, well thanks for your response.

Equally, if anyone else on the forum has any ideas/suggestions on what someone in my position could do, please share.

Many thanks

kingstreet

A joint mortgage with someone retired is unlikely.

A deposit loaned, not gifted, will be an issue.

Dave suggested you obtain copies of your partner's credit file from all three CRAs. You may be under the misapprehension this involves a logged credit search. It doesn't.

Equifax

https://www.econsumer.equifax.co.uk/consumer/uk/order.ehtml?prod_cd=UKSCR

Experian

http://www.experian.co.uk/consumer/statutory-report.html#orderReport

CallCredit

https://www.callcredit.co.uk/stat-report-online/index.php?action=basket_add&tpl=setRegister&package=63&amount=1&mode=clear

Do not assume that every entry will appear on every file. Sometimes the information on each one is different.

Put the files and your other information in front of a whole market broker and see what they can do. You may come away with only an idea of how much deposit you'll need and the likely mortgage rate, but at least you'll have something you can rely on.