Mortgage and DMP

Miamag

After some sound advice so will fill in the full story so I can possibly get help

My father recently passed away and I have to sell the family home and split sale with my brother.

I will obviously be looking for a new home but recently have been in a DMP, I cleared the debts but 2 out of the 4 were cleared by Full & Final Settlements. I have also missed a couple of payments earlier this year before they were paid off.

I will have around 55,000 to look for a new home and have seen houses ranging from 60,000- 75,000 that I like the look of.

My questions are If I use around 40-45,000 as a deposit, will I be able to pick up a 20-30k mortgage with my history ?

Am I better renting first for a bit ?

Thanks In Advance

kingstreet

Obtain all three versions of your credit file, as what is still visible on them will determine the outcome.

You'll get a mortgage, but how much you'll pay is going to be the issue here.

ACG

Im with Kingstreet getting a mortgage should not be an issue (assuming you have a job). The low loan to value should make this easy enough, the DMP is going to prevent the majority if not all of the high street lenders however.

I would suggest getting your credit reports to a broker. I would assume you will need a broker who charges a fee as the mortgage will be that small the commission will not cover it.

Miamag

Yes I have a job, the DMP came about due to being made redundant, got back to work but on a lot less money, building back up now and have a decent income and a secure enough career.

Looking at paying no more than £200 a month on a mortgage which I can comfortably afford, would like 15-20 year mortgage if possible

kingstreet

Miamag wrote: »

Yes I have a job, the DMP came about due to being made redundant, got back to work but on a lot less money, building back up now and have a decent income and a secure enough career.

Looking at paying no more than £200 a month on a mortgage which I can comfortably afford, would like 15-20 year mortgage if possible

You need to discuss this with your chosen broker with your three credit files in your hand.

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

Miamag

I've done the Equifax report and it shows 2 loans and credit card as defaults, everything else is clear

2 of the defaults are from 2010 and one is from March 2012

ACG

Anything under 50% LTV should be easy enough to sort out albeit at higher rates than normal.

If you go to 60% LTV then your going to be looking at rates close to 7-8%. I dont think you would get anything above 60% LTV.

Miamag

It will be around 40% LTV, realistically looking at 40k deposit on 65-70k home, what sort of rates will I be looking at, will it be worth renting for a while first to boost credit score or not ?

ACG

Im nto sure as i have never done an adverse mortgage at such a low LTV - usually people want the most they can get.

I would say work out the repayments on 6, 7 and 8%. I cant see it being below 6% to be honest.

As for which is better only you can decide but you will need to sit down with a broker - let them come back with what they can get you and then you can make a comparison.

kingstreet

Miamag wrote: »

I've done the Equifax report and it shows 2 loans and credit card as defaults, everything else is clear

2 of the defaults are from 2010 and one is from March 2012

Do the others.

They do not necessarily show the same things and lenders can often use just one, or two and not all three.

Your broker needs to know the full picture, as he may favour, or dismiss particular lenders, based on the data in each file.

Miamag

I've requested the other 2 reports