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Bad Credit Mortgage?
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jlojgirl
Posts: 11 Forumite
Hi all,
I'm hoping to get a bit of advice.
I currently own a maisonette with my husband. We bought the house in 2006, was on a repayment mortgage for a few years, but have been interest free for the last 3-4 years or so. Bit of background.
Our house was £160,500, but we borrowed £20k ontop (to pay off existing debt), so our mortgage was £180,500. We probably didn't make much of a dent in the mortgage in the few years we were paying it off.
It came to my attention last week, that property prices have shot through the roof in recent months, and looks like our house is worth a lot more than we thought. From looking at other properties of the same ilk around our area, it's like we could get in the region of about £220-£240k. We are having a few appraisals this weekend to get a better idea.
Since learning this, my husband and I have been discussing the option of moving into somewhere bigger. We've had a child since moving in, and it'd be nice to have more room.
Our problem is this. In the last few years, we had a lots of money troubles. My husband was self employed, then I was self employed, new baby, childcare, ect ect, and we got ourselves into quite a bit of debt (around £20K officially - although more like £28K with the money we borrowed from my Dad)
We never defaulted on our mortgage, or council tax, but our debtors unfortunately took a hit.
We took out a Debt Management Plan (DMP) with the help of CAB, but was then able to pay a few debtors off (with a reduced balance) with some money we inherited.
We now only owe £6K, of which are to 2 credit cards, but via the DMP.
Sorry, i'm going on a bit. Just want to give you as much info as I can to gain some insight into whether we shouldn't even entertain a new mortgage.
So, if we can get a decent enough price for our current house, our next step is to obviously get a new mortgage and buy somewhere slightly bigger (probably in a lesser area), but will we be able to get a mortgage? Do BAD CREDIT mortgages really exist? And if so, are they worth it?
My husband and I are now both employed, and our salaries are higher than when we bought 1st time around.
Any advice would be good.
Thank you
Louise x
I'm hoping to get a bit of advice.
I currently own a maisonette with my husband. We bought the house in 2006, was on a repayment mortgage for a few years, but have been interest free for the last 3-4 years or so. Bit of background.
Our house was £160,500, but we borrowed £20k ontop (to pay off existing debt), so our mortgage was £180,500. We probably didn't make much of a dent in the mortgage in the few years we were paying it off.
It came to my attention last week, that property prices have shot through the roof in recent months, and looks like our house is worth a lot more than we thought. From looking at other properties of the same ilk around our area, it's like we could get in the region of about £220-£240k. We are having a few appraisals this weekend to get a better idea.
Since learning this, my husband and I have been discussing the option of moving into somewhere bigger. We've had a child since moving in, and it'd be nice to have more room.
Our problem is this. In the last few years, we had a lots of money troubles. My husband was self employed, then I was self employed, new baby, childcare, ect ect, and we got ourselves into quite a bit of debt (around £20K officially - although more like £28K with the money we borrowed from my Dad)
We never defaulted on our mortgage, or council tax, but our debtors unfortunately took a hit.
We took out a Debt Management Plan (DMP) with the help of CAB, but was then able to pay a few debtors off (with a reduced balance) with some money we inherited.
We now only owe £6K, of which are to 2 credit cards, but via the DMP.
Sorry, i'm going on a bit. Just want to give you as much info as I can to gain some insight into whether we shouldn't even entertain a new mortgage.
So, if we can get a decent enough price for our current house, our next step is to obviously get a new mortgage and buy somewhere slightly bigger (probably in a lesser area), but will we be able to get a mortgage? Do BAD CREDIT mortgages really exist? And if so, are they worth it?
My husband and I are now both employed, and our salaries are higher than when we bought 1st time around.
Any advice would be good.
Thank you
Louise x
0
Comments
-
You'll need a big deposit and then be stung for interest way over and above the high street lenders as you'll be subprime. Doubt you would be successful with the new MMR rules either.
Advice
1) save up a 20% deposit.
2) pay off the DMP and wait 6 years for your credit file to be squeaky clean0
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