Mortgage FTB (poss. Help to Buy guarantee) with CCJ

Jb2710

Good Evening,

Bit of background- my husband and I are FTB with an approx. £11k deposit on a house worth £200k (we are buying from a relative so there is no urgency in the sale although we would like to buy before December 2014). We have a joint income of £61k (Income1- 33,000 and Income2- 28,000). We have outstanding debts of £5000 (x2 CC and x1 bed on 0%apr) which will be repaid by February 2014. We have cleared £13,000 debt in 12 months (£22k in last 4 years) which was racked up as irresponsible young borrowers. All payments have been made on time, usually above the minimum.

Stupidly, while paying off all of these debts a water bill slipped through the net- I know there are no excuses for this so please don't remind me what a bad payer I am like another board has!- and resulted in a CCJ for £247 in Feb 2013. I found this on a credit report last month and repaid it immediately so it is now settled.

I am surprised the CCJ was issued in February as in May I was accepted for a 0%balance transfer for 19 months card (Barclaycard) with a credit limit of £5k (I BT'd a £3k card and haven't used otherwise) but would have expected a rejection at this point which would have alerted me sooner. I also have a Next Account with a £5k limit (zero balance) and a 2nd Barclaycard with a £3800 limit (again, zero balance as 0% term ended in September).

My question is, would we be able to approach high street lenders to consider us for a help to buy guarantee mortgage? The scheme rules describe credit impaired as "has been the subject of one or more county court judgments, with a total value greater than £500 (five hundred pounds sterling), within the last three (3) years before the Date of Completion" which would not include our one CCJ of £247.

I really really hope that one lender at least will look at how hard we've worked to clear our debts and that this silly mistake (we are solely to blame no doubt but it was genuinely missed rather than ignored) won't hold us back for another 5 years.

Thanks for reading

J

Thrugelmir

A CCJ is treated very seriously as it's the last resort in the collection of an outstanding debt. The person applying has to prove that they've made every reasonable attempt to contact the creditor in order for the court to issue a CCJ.

You may to target a far higher deposit to convince a mainstream lender to consider you.

Jb2710

Thanks for the swift response- I'm aware of the seriousness of the CCJ hence the repaying of the debt as soon as I became acutely aware of it. My query is more to the HTB mortgage guarantee as their rules count credit impairment as a CCJ totalling more than £500 which ours doesn't and whether high street lenders will apply this to their criteria for a HTB mortgage as opposed to their stricter almost zero tolerance approach.

Of course, if we're going to declined for all mortgages for the next 5 years we'll have to suck it up and consider the nice big deposit we'd have in 2018.

mrginge

I don't think a 95% mortgage with a CCJ is going to happen tbh.

amnblog

The impaired credit definition as in the rules which relates (amongst other things) to CCJ's is ta 'catchall' definition.

You still have to pass lenders credit score and if you intend to do this on 5% or 10% deposit with a recent CCJ I think you will be very fortunate to get a result.

Jb2710

Thanks all! I guess I was hoping that a satisfied CCJ of such a relatively small amount (one glance at outer credit file at payments of £450+ off of credit cards monthly- way way above min payments!-Would indicate that if we'd have been acutely aware of the bill we'd never have let it get to CCJ stage) would be viewed much more positively than a satisfied or un satisfied CCJ of a much larger amount and that with the government backing a proportion of the mortgage mainstream lenders may view us as a lesser risk as out credit files are otherwise literally perfect in term of repayment and settlement on CC's, bills, HP (car) and loans.

Never mind, back to the drawing board to work out how to raise a £40k deposit...ho hum.