Credit Rating and mortgage plans and clearance of defaults

scottyc_2

Hi folks i'll give a little background to what my situation is.

Me and my GF have been together for nearing 2.5 years now we're currently saving for a Mortgage, our plan is to get a cottage/Bungalow in about 18 months time out in the sticks nothing of grandeur, just a 2 bedroom and very modest we're limiting to a max of 100k but i think we'll be going for something between 80-100k. Based on what we're looking at currently although you never know with the housing market in over a years time, anyway. We've saved 2.6k already and we put away 400 hundred each a month so 800 between us both to our mortgage. So in 18 months we should have around 17k for our deposit.

My Girlfriends credit is fine, she has no cards, not any more and hasn't defaulted on them, no monthly debit payments or anything else that would hold her back.
I on the other hand have had a past of a few defaults most had been partly repaid but now they have all been past 6 years they are off my credit rating, i use Experian to check up on my account. Although all this is behind me thankfully it's still urks me i was stupid i do have monthly DD of, SKY, mobile and netflix and my Experian account now though, all being paid on time as i finally sorted myself out. I also have a prepaid cash plus card that has money in it but i don't touch that, that's just there as it comes off as monthly payments and helps my credit or at least i hope it does.

I am having to get ack onto the electoral roll as the first posting i sent about 6 months ago with recorded delivery hasn't update where i stay now but i've just emailed my scan of the document so i should be back on the Electoral roll very soon.

I have some questions...

My old credit card and bank account way back even though they are cleared now, 6 years+ will i have to contact my old bank and CC supplier to cancel my account or would that automatically have been done by the Bank and CC suppliers themselves?

In 18 months with a 17k deposit and my credit rating which should have improved a fair bit what would you feel of my chances for the mortgage i would be after? my past worries me but i feel that 18 months is too short to build up credit good enough or mortgage worthy.

Thanks so much for reading my speel, i appreciate any input.

[Deleted User]

scottyc wrote: »

My Girlfriends credit is fine, she has no cards, not any more and hasn't defaulted on them, no monthly debit payments or anything else that would hold her back.

It doesn't quite work like that. If she is not using credit, lenders will be wary of her ability to handle it.

It looks as if the best thing you could both do is start using a credit card each, but in a controlled, sensible way. You both need to build some decent credit history.

Tixy

My old credit card and bank account way back even though they are cleared now, 6
years+ will i have to contact my old bank and CC supplier to cancel my account
or would that automatically have been done by the Bank and CC suppliers
themselves?

Are the accounts open or closed? Once they are closed they will automatically be removed from your credit file 6years after the date they are closed.

In 18 months with a 17k deposit and my credit rating which should have improved a fair bit what would you feel of my chances for the mortgage i would be after? my past worries me but i feel that 18 months is too short to build up credit good enough or mortgage worthy.

From what you have written it sounds like you should stand a reasonable chance of being accepted from the point of view of your credit file (obviously you also need to consider affordability/job security etc that a lender will take in to account).

As zx suggests though - it would probably be a good idea for you both to take out and use a credit card regularly to maintain an ongoing postive credit history. If you pay in full each month it won't cost you anything in interest.

Then over the next 18months ensure you make all payments to all accounts are on time.

scottyc_2

She used to have Credit Cards but not anymore, i suppose if she also gets a pre paid card like a cash plus, that would help her credit as it comes with a monthly payment 'subscription'.

Tixy my accounts were open i haven't closed them but i'm assuming that my accounts would be closed 6 years after my default date and they've been wiped from my report, is this the case? or would those companies keep those accounts open?

Thanks very much for you time to reply

[Deleted User]

The accounts don't get closed in line with the 6 year rule for defaults.

Are they showing on any of your credit reports? If not, then they should be closed.

scottyc_2

Deleted_User wrote: »

The accounts don't get closed in line with the 6 year rule for defaults.

Are they showing on any of your credit reports? If not, then they should be closed.

No they did a few months ago but then the 6 year default came in and the account that was in arrears was gone. I'm sure my CC are cancelled but i'm going to check my old bank account and phone up and see just to be sure.

Tixy

If the accounts had defaults they would be closed.
If they didn't have defaults they would usually remain open unless you closed them (although banks do sometimes write to people to close dormant accounts).

In terms of building a credit history for a mortgage girlfriend would be far better with a proper credit card than a cashplus prepaid card.
A cashplus card shows a potential lender she can repay a £60 loan over a year (or whatever), a credit card shows she can handle a revolving credit account responsibly, make payments on time and not run up debts/spend more than she earns.

scottyc_2

Thanks Tixy, i really appreciate your time to reply. You are correct that makes sense about the Credit Cards, i just remember my old BOS account had a new ard sent to my old address being my parents address so, i wil write to them tomorrow and close my account, if i go in Branch to close even though my debt from the bank is wiped could they complain or ask for the money if i went in to close the account personally?

Thrugelmir

You'll need 3 years of electoral roll history at least.

The larger the deposit you can save the easier you'll find it to obtain a mortgage. Far outweighs any benefits from tinkering with credit cards. Where you save is equally important. As if it's with the lender you obtain the mortgage from this will earn you brownie points. Both Halifax and Nationwide have savings schemes. Alternatively a local building society maybe an option. As underwriting is more personalised affair.

scottyc_2

Thrugelmir wrote: »

You'll need 3 years of electoral roll history at least.

The larger the deposit you can save the easier you'll find it to obtain a mortgage. Far outweighs any benefits from tinkering with credit cards. Where you save is equally important. As if it's with the lender you obtain the mortgage from this will earn you brownie points. Both Halifax and Nationwide have savings schemes. Alternatively a local building society maybe an option. As underwriting is more personalised affair.

I was on the ER at my parents address for years, i've asked to have my previous address history on my ER too, thing is depending on how things work out at our current address we could be moving out in 6 months but then i'd just update the ER with a new address.

Thrugelmir

Providing there's no gaps and your registered somewhere. There's no issue.