Possible default on credit file may affect mortgage application

Eden_green

Hello, I am looking for some advice as I am going to be applying for a joint mortgage with my partner and worried my previous bad debts will affect out mortgage application.

My salary is £35k and my partners £40 and we have a deposit of £90k based on equity and savings. We are looking to purchase a £270k property on a joint mortgage although my partner has an existing mortgage on his property. This will be my first mortgage.

I defaulted on 2 accounts in 2010, but settled the accounts in October 2011 and in August 2013.

Will they still appear on my credit score as I read that defaults stay on your credit file for six solid years from the date the default was documented? I also read that after the period, it will automatically be deleted from your credit report, whether it has been paid, satisfied or not.

As they were defaulted in 2010 does that mean they will no longer appear on my credit score?

Any advise is greatly appreciated as very worried about application.

ACG

If the default date was 2010, they will still be on your credit report for another 3 years give or take.

The size of your deposit is quite healthy, some lenders may ignore the defaults as they are over 3 years old. Some will ignore them if they were under a certain amount.

Do not make any applications until you have either spoken to a broker or checked the lenders criteria. If you make an application without checking the criteria you could be causing more harm than good.

Personally i would suggest you get all 3 credit reports down to a decent broker. The good news is im pretty sure you will be able to get decent enough rates because of the deposit and the age of the defaults, however you may find some lenders not wanting to accept you so its important the research is done beforehand.

Good luck, but as i say im sure you will not have too many difficulties.

Eden_green

Apologies I have just realised I wrote 2010 as default date, it was actually 2005. My last credit report date was 2010. I assume this will now make a slight difference? Thanks.

ACG

Definitely, when i was reading it i was thinking you you know it stays on your credit report for 6 years yet your asking if it will have disappeared since 2010 - i nearly did a sarky reply... im glad i kept it professional now :-P

You should be fine assuming everything else is ok.

Eden_green

Thank you for your advice. Would have accepted a sarky comment having read back my origional post!

ACG

No probs. Come back and let us know if you have any issues though and im sure myself and the other brokers (who have a life on a friday night) will help where possible.

rosssanderson

I have a question about this, I spoke to a mortgage advisor today, he told me he had an argument with an underwriter becasue they refused someone who credit history was supposedly clean i.e any defaults had dropped off, the underwriter said the defaults have to settled for 6 years before they would pass.
My question now is, i have a default from 12 years ago that i never settled, would have dropped off 5 years ago, i cant even remember what it is, (i was young and foolish) If i never settled it would i be refused because of this even though its not on my report anymore?

kingstreet

How would they know if it was satisfied or not, unless it was a debt with that particular lender group?

Once it is no longer visible, that's it, unless the lender can see it on internal records.

rosssanderson

That is true, he never said if the default was with them or not in reference to the person he was talking about. He just said to pass defaults have to be settled for 6 years