Mortgage application & history of payday loans.. help!!

lisajane12345

Me and my partner are looking to apply for a mortgage at some point this year. My credit file is immaculate, however, he has a history of payday lending from 2012-2014 nearly every month... each was paid on time and there was never a late payment. Will this stop us from getting a mortgag? And if so, how long for?! Thanks in advance

Hazzinho

It MAY have an effect, people take out PDL's when they are struggling badly financially, 2014 is fairly recent.

lisajane12345

Hazzinho wrote: »

It MAY have an effect, people take out PDL's when they are struggling badly financially, 2014 is fairly recent.

I know his financial situation has completely changed in the last 12 months with the closure of three current accounts with outstanding overdrafts paid off and closed, all debts repaid except a small outstanding overdraft on a single current account which will be repaid by the summer and he now has a barclaycard initial to rebuild a positive credit history.

Do you have any idea at what point will the PDL's be taken into account? During the initial credit application or will it not be taken into account up until the application is being fully reviewed by underwriters?

Thanks

[Deleted User]

Can you put down more then the deposit?

Hope you get answers, please can you update if you get anywhere x

Thrugelmir

lisajane12345 wrote: »

all debts repaid except a small outstanding overdraft on a single current account which will be repaid by the summer and he now has a barclaycard initial to rebuild a positive credit history.

Forget about rebuilding your credit history. Tackle what is already left there first. If you have savings clear the debts.

chanz4

the one question that pops into my head is deposit source, if payday loans have been taken every month

lisajane12345

chanz4 wrote: »

the one question that pops into my head is deposit source, if payday loans have been taken every month

The payday loans havent been taken out for over a year now & we currently are living with my parents rent free which has allowed us both to use a large proportion of our salaries to save a deposit

YorkshireBoy

lisajane12345 wrote: »

...which has allowed us both to use a large proportion of our salaries to save a deposit

Surely some of these savings should immediately be used to settle the "small outstanding overdraft" NOW...not "by the summer"?

lisajane12345

YorkshireBoy wrote: »

Surely some of these savings should immediately be used to settle the "small outstanding overdraft" NOW...not "by the summer"?

Its an arranged overdraft though so as far as im aware they dont have a negative impact on a credit report?

chanz4

any overdraft shows you are living beyond, pay it off

Zenboor

lisajane12345 wrote: »

Me and my partner are looking to apply for a mortgage at some point this year. My credit file is immaculate, however, he has a history of payday lending from 2012-2014 nearly every month... each was paid on time and there was never a late payment. Will this stop us from getting a mortgag? And if so, how long for?! Thanks in advance

We got a mortgage with Halifax in 2013 even though I had half a dozen settled PDL entries on my credit file. As first time buyers, we had to pay 15% deposit and got a fixed rate of 4.24% for 2 years. So not the best but not the worst in the world either.

You're not going to know exactly how lenders treat the existence of these entries in your credit file. Some will view them as toxic, others will consider more positive elements of your credit report. But ultimately, you won't know until you apply.

Hope things work out for you!