Mortgage after DMP

Textbox

Hi, was wondering if anyone knowledgeable could advise me?

My partner and I have just completed a DMP. After checking both our credit files on Experian it appears mine is 'fair' with 2 satisfied defaults from 2012 and arrangement to pays that have just finished. His is 'poor' with 3 defaults from 2011 and 2012 and numerous missed payments.

Now the debt is gone we are hoping to think about moving but unsure how long it will take us to improve the credit files enough for anyone to lend us anything.

My partner earns approx £45,000 pa and I earn approx £11,000 pa. We have roughly £40,000 equity in our house at the moment.

What kind of loan to value and interest rates should we expect or is it a lost cause?

Many Thanks.

Thrugelmir

Are the numerous missed payments since 2012?

Textbox

Yes, on an unsecured loan. He was paying less than the contracted amount due to the dmp and they were recording it as missed payments. The loan is now settled but at worst was status 5.

Dave_Ham

15% deposit is likely to be the magic figure here, but will depend upon the rest of the case.

Textbox

Thanks Dave. We could certainly manage a 15% deposit, when you say the rest of the case....?

Thrugelmir

Your recent credit history will be a major factor in any decision. Along with the organisations you defaulted on. As they are highly unlikely to consider offering you a further advance if you've defaulted on a previous agreement with them.

Textbox

We had come to the conclusion it was going to take a good couple of years before we could go anywhere, anything sooner would be a bonus.

It's ironic as we're far more financially responsible now than we've ever been, with a much higher disposable income.

Thankyou for replying Thrugelmir.

Dave_Ham

As suggested, payment record across last 24 months on all bills, rent, commitments etc.

Number of dependents, type of income, type of property, location geographically (not all lenders of this type lend in Scotland for example) and other factors will be crucial to success.

Also, you may only have one credit file that you are working off but the reality is that the other 2 may have information registered differently.

This is not going to be easy and you are likely to require your Experian, Equifax and Call Credit records and an experienced broker - steer clear of the Estate Agent ones..

Good luck

ACG

Lenders tend to go off worse case scenario - so they are looking at your history and basing it off that, not ideal but understandable where large sums of money are concerned.

As Dave says, with a 15% deposit there will be a couple of lenders who will consider this. By the rest of the case im assuming he means affordability and you meeting the lenders criteria.

Definitely one for a broker though as i dont think high street lenders will look at it.

Textbox

Thankyou for your advice everyone. Maybe it's best to sit tight for now and make some overpayments on our mortgage.

Thrugelmir

Won't do any harm. Time is a healer.