Mortgage assistance, how to lower amount of deposit required?

cantona7219

Hi

I'm currently self employed earning about £15000 a year, have 2 or 3 years worth of accounts.

The only debt I currently have is an overdraft which is on a student account interest free and it is sitting at £500 with the limit being £1250 and I have £200 on a £500 credit card.

On my credit report, I have had 2 late payments in the last year however in February these will have dropped off. And, I have had a significant number of credit accounts settled 26, have zero defaults or CCJ'S.

I applied through a broker a few months ago for a mortgage for a house in the price region of £45000-£48000 however I was advised a 15% deposit was needed, is there any way or suggestions on how I could reduce this to either 5% or 10%? As whilst I could probably afford it, being self employed this money is essential for cash flow.

I'm based in Scotland, and am aware of the LIFT scheme, however when I applied 2 months ago the broker said my credit score wasn't suitable for the scheme, will this have changed when the late payments are over a year old?

Any assistance or suggestions would be most welcome

Cheers

Dave_Ham

Possibly, but it is not clear from your information whether the late payments are 1 years or 6 years old?

Furthermore your previous years income will be required as you will be relatively tight on affordability, as many lenders do not simply apply the 5 times income maximum on self employed incomes at this level.

Goes without saying, 10% deposit will be easier than 5%.

Lender selection will be crucial, which lender accepted you with 15% deposit and where have been tried?

cantona7219

I think it was Halifax the lender said it was for. The late payments are about 11 months old, so will be over a year old come February.

I take it you have to have a seriously high score to get accepted for the LIFT scheme? Also, come April I will be able to have another years worth of accounts, this time showing profits of over £20,000

Dave_Ham

Halifax were amongst the most flexible lenders of 2013, although tightened up their credit score and multiples about October/November time.

Missed payments within the year are likely (not guaranteed) to preclude you from the 5% schemes, although I would fancy solutions at 10% deposit.

Higher income will help, although not necessarily essential but heavily dependent on lender selection.

All the best

cantona7219

Does anybody know about the credit score required for the LIFT scheme in Scotland?

jakiphoto

Hello Cantona

I am also self employed, in Scotland - earning between 12-15000 a year, although I only have 2 years of accounts and in the first year I made a loss.

I don't think I will be able to apply for a mortgage yet on my own, I have a good credit score but I don't think I have been self employed for long enough.

I would be interested to know which broker you went to and how you get on with buying your house as Im always in here looking for people in the same boat as me :j

Thanks