Tiny default- is this what is stopping us getting a mortgage?

guineapiggirl13

Hello,
My partner and I are looking to get our first house together (I have had a mortgage previously but am no longer named on it).

I have a credit card with £500 and an overdraft for £1500 and my partner has an overdraft of £500 and a credit card of £1500. We both have mobile phone contracts and I have a finance agreement for my car. We have no late or missed payments on any of these.

We applied for a mortgage at the Post Office and were turned down, they are unable to say exactly why. I checked all 3 of my credit reports and all I can see is a default for £24 from an old mobile phone contract within the last 12 months on my equifax and noddle reports. This was entirely innocent, I never missed a payment before and we moved after the contract ended so was not aware I owed this. I have now satisfied this with the phone company.

We don't want to apply for any more AIPs in case we are declined again, is there any chance of us getting a mortgage or has the cost of a double disc DVD set now scuppered our chances?

ACG

Probably yes.

This is off their lending criteria:

had no more than one County Court Judgement (CCJ) of up to £250. This must have been over 12 months ago

It depends on the size of your deposit (as a percentage) and how much the default was for.

guineapiggirl13

Our deposit is 20%, courtesy of mum and dad!

ACG

You either need to check lenders criteria before you make an application (both in terms of adverse credit and source of deposit) or speak to a broker - i would be pretty confident this can be done at normal rates.

Dave_Ham

Definitely achievable, although be very mindful that you largely get neutral opinion on here.

You walk into x bank on the highstreet and ask if this will be an issue, it is almost guaranteed they will say no.

They only have one criteria and one set of products to work from and are targeted on sales.

Just be careful on your next steps, but with 20% deposit this will be achievable.

Best of luck

Let_Us_See

Could be due to to default, but might just be a simple case of unaffordability?

guineapiggirl13

Thanks guys, we have seen a mortgage adviser who has said it should be quite easily achievable and should find out early next week how we get on. Our affordability shouldn't be a problem, we earn almost £50,000 between us and are looking between £130,000-£140,000.

Thrugelmir

guineapiggirl13 wrote: »

we earn almost £50,000 between us and are looking between £130,000-£140,000.

So why overdrafts and no savings? (from a lenders perspective).