Bad credit mortgage

lowely

Hi All,

I was hoping you may be able to help. Due to some horrible life decisions (entirely my fault) a while ago, I made myself bankrupt. However, I have since managed to pull my life together and I am now discharged and the bankruptcy was 7 years ago and has been removed from my credit file.

So, I was wondering if anyone might be able to advise if a mortgage will be possible? Obviously, my past credit issues will be a huge stumbling block and I have also just changed bank account.

We would be looking for a £300,000 house. I alone would be applying with a salary of £52,000 and a deposit of £85,000 (although I am married and have a 1 year old daughter). Am I being completely deluded or is there a genuine chance of a mortgage. Any help / advice would be much appreciated.

Thanks.

L.

GMS

Assuming good credit conduct since the bankruptcy you may well have options.

Be careful. Many lenders will decline if you have EVER been bankrupt.

A broker may be useful for you here.

ethank

What is the source of the deposit?

kingstreet

Married but applying alone? Why?

Is the deposit coming from joint money? If so, you may have an issue.

lowely

Hi All,

Thank you for the replies.

The money is from an inheritance.

I am applying alone as my wife is not in work at the moment (she is looking after our children). Will all of this have a negative or positive impact?

Thanks again for the help.

L.

kingstreet

Affordability looks ok on a joint application, even with a child and non-working spouse.

Check calculators for preferred lenders to ensure all are above what you need. Assumes you have no credit commitments, childcare costs, maintenance etc.

ethank

I am sure the lender would prefer the joint application - it shows stability.

lowely

Thanks for all of the advice - it really is much appreciated.

I have just spoken to London & Country mortgage brokers and the adviser said that even with my bankruptcy, he would "tick" the no credit issues as it has fallen off my file and lenders would not check. As far as I am aware, I thought that all lenders would check this as it is a matter of public record? This has concerned me a little and any clarity would be much appreciated. On top of this, he said with a wage of 52,000 and and 80,000 deposit, a 300000 property should be no problem. I no shouldn't doubt the guy but if any mortgage adviser could validate this I would really appreciate it.

Thanks again.

L.

NorthernOne

Try phoning around first and asking for views on if someone with your history would be able to apply. I would start with building societies that actually look at applications rather than computer decisions that most major banks use.

I was in a similar position and got my mortgage via the Leeds and applied direct rather after speaking with them (have to be discharged for 6 years with clear history since for them to consider ex bankrupts) than using brokers who in the large are not interested in you unless you are an easy fee. (No disrespect to some brokers on this forum) but that was my experience.

Make sure you have also checked your credit files and they are all clear.

Good luck.

kingstreet

I don't agree with L&C.

Some lenders are happy with a "no" answer to the question "have you ever been bankrupt" when it is more than six years ago and others aren't.

As a broker, you need to establish the lender's position, before you decide on how to answer the question which is asked.

The point here is the solicitor acting for you and the lender carries out a bankruptcy search close to exchange of contracts. If you've informed the lender and it is notified of the positive search result by the solicitor, there will be no problem.

If a broker assumes the lender wants a "no" answer because it's more than six years ago, then the lender gets the search result and is unhappy with the initial declaration, it may then become an issue.

lindsaygalaxy

Do you extra money saved for moving costs? Stamp duty will be 3% on a 300k house.