Help To Buy Mortgage with Poor Credit File??

cupcake2014

**sorry have posted this in here as well as the credit forum as wasn't sure which one to post in being a newbie n'all!!**

Hi everyone, first post ever on MSE, hoping to get some advice from all you knowledgable lot :-)

Ok so me and my partner are wanting to offer on a new home, on the HTB Scheme. We have passed the income check to ensure we can afford the mortgage etc and have our 5% deposit. Now, the next stage is passing the credit check. My partner has an excellent credit score of 880. Mine is 507 :-( this is probaby due to a mixture of things. I.e. having about 4 addresses in the last 6 years (nothing untoward, just normal situational changes, never kicked out or anything) my age (am only 25yrs old), my 2 late payments on an old (and closed) catalogue account, and most significantly, my 1 x default on an old phone contract exactly 4yrs ago. (Amount was £14!!! Don't know how this happened...prob change of address)

Now, I am scared about our mortgage application, and would be so gutted for my partner who desperately wants us to get a home together. I will feel like such a failure!

We've spoken with a mortgage broker who are going to do some research for us, but in the interim I just need a bit of advice or words of hope from anyone who can really..

What are our chances?? I've heard HTB are very strict... I can't bear the thought of waiting until 2016 til the default is cleared. Back then I was in a bit of a bad place but my life has completely changed and I have a fantastic job and everything is just great. I'm saving and am really careful with my spending. I closed all my catalogue/store card accounts in 2012 and now only have a credit card which I rarely use, it only has 200 pounds on it to pay with a limit of 2500. I only use it if I really really need to and pay back big chunks (if not all of it) every month. I'm on the electoral rol but have been on and off of it so this of course shows up on my credit history

Can anyone think of a way to get it better? Or will I not get a mortgage until my default is gone? I'm clearing my credit card at the end of June payday and then I will have no credit accounts under my name.

Any advice, tips, honesty etc etc would go hugely appreciated. Thank you all !! Xxx

ACG

As its 4 years old there are 1 or 2 lenders who may look at it.

I would be relatively confident there would be a lender who would lend you money, affordability I cant confirm as all lenders have their own way of calculating and without knowing more its difficult to say.

cupcake2014

Thank you for your reply!!

Do you know of any lenders in particular who also accept the help to buy? I was told the common lenders for the new homes market is halifax, natwest, hsbc, nationwide, woolwich, santander, and a couple of others which i have never heard of. But i heard big high street banks wont touch me with a bargepole cos of my default! Im getting so stressed about all of this silly I know but I am just so worried! is there anything i can do to improve it before we put in our application?

Dave_Ham

Engage a competent advisor, let them fully appreciate your situation and give formal advice.


It would be useful to have all of your credit files; Experian, Equifax and Call Credit.


No-one qualified is going to name drop lenders, you just need to get formal advice.


The default does not rule out help to buy, but does make it tricky.


Have you satisfied the default?

ACG

As dave says, a broker should be able to sort this for you - maybe with a high street lender, maybe not.

We cant name lenders as it could be seen as leading - which could result in us losing our license.

amnblog

If we did name a Lender or Lender's that doesn't really help anyway as it is not a simple as that.

I could tell you Tesco and Lidl sell beans, but you will need my help or they won't sell them to you.

stalkah

Are you looking to use help to buy guaranteed mortgage or the equity share? Sorry if you've already said this I've skim read and couldn't see it

Butti

I would advise you to do what I did and get a credit report, get your reasons sorted out and when you go in for a meeting with the broker or the mortgage adviser take everything and YOU highlight where there are issues. It might work, it might not but it did for me because I was so honest.

cupcake2014

Sorry for the delay guys, and thank you so much for your responses!

Ahhhh, I didn't think about name-dropping, apologies! I completely understand!

Stalkah - I am looking to do the 20% equity share.

I seem to have a really good broker who is really helpful and positive but I am still worrying myself to bits! It was 4 years ago, and for £14! Do they look at the intricate details or do they just see DEFAULT and the year you defaulted?

I havent had any issues at all the past 2 years apart from a couple of times where i've not been on the electoral role. My partners history is excellent, so does this also make a difference?

my equifax history seems to be worse than my callcredit one, why is this?? my public file is over 800, but not sure what this means haha.

thanks again all

stalkah

First of all ignore the scores they are pretty much worthless each lendor has their own criteria and scoring system.

As long as you've had no problems in the last couple of years your adviser will be able to help