what is better?

quidsy

Does paying off a defaulted loan in full look better to mortgage lenders rather than partially satisfying the loan?


The default is 2 yo and payments are up to date, I want to get a mortgage in 2 years time and wish to minimise the impact of the default so wonder whether waiting a bit longer and paying off in full or partially satisfying now will be the more positive.

Thanks for helping.

Marcus676_2

it does make a difference, it still looks bad but at least the creditor got the money back. I was offered a partial at around 50% but I refused it, it will show as partial on CR's.
I figured it was best to make the best of a bad situation, what better way to show a change of ways/attitude that to pay what is actually owed.


hope this helps

Thrugelmir

If a mortgage is your aim then pay it off as soon as is possible.

Paying in installments merely extends the time you'll have to wait. An interest free loan comes at a cost.