Seriously... How hard is it to get a Mortgage?

jn1

I have a question if I may,

How hard is it to get a mortgage?

I have defaults against my name from 2010 and they seem to be affecting my history some what.. I have also had pay day loans as a friend told me that this would help my 'credit history' so I took two out over a couple of months and paid them back.

I am on over 90k p/a and have a 5% deposit (want to buy at circa 250k no more because of stamp duty)

Given all of this, is it worth me applying, or shall I just keep saving and wait until 2016 when hopefully the defaults will come off my history.

I think the scoring system is crazy, I was a different person in 2010, I now have a family and I have NEVER missed my rent..

Any advice would be brill..

kingstreet

95% with adverse credit visible on your credit files isn't going to be easy.

At that level of income, a bigger deposit should be achievable within a short timescale, improving your chances of a mortgage and reducing your possible rate options.

Broker job, IMHO.

marathonic

jn1 wrote: »

I have also had pay day loans as a friend told me that this would help my 'credit history' so I took two out over a couple of months and paid them back.

Payday loans hurt your credit score, not help it. They show that your money management skills forced you to resort to lending money at APR's of 1000%+

marathonic

jn1 wrote: »

want to buy at circa 250k no more because of stamp duty

From a tax perspective, recent changes in Stamp Duty rules make paying 260k not that much worse than paying 250k.

You don't pay the higher rate on the whole amount anymore so paying 260k means that you'd only pay the higher rate of stamp duty on the 10k that exceeds the 250k threshold.

nidO

jn1 wrote: »

I have a question if I may,

How hard is it to get a mortgage?

From personal experience? Easy. I've applied for 3 in my life (all since 2009) and have been accepted painlessly for all 3.

jn1 wrote: »

I have also had pay day loans as a friend told me that this would help my 'credit history' so I took two out over a couple of months and paid them back.

Unfortunately your friend's advice has stiffed you. Having a history of using and paying back credit is a positive thing, but payday loans look bad to lenders as having a payday loan is a sign that you're in imminent financial trouble.
If you only have a minimal credit history you'd do better to get yourself a mobile phone contract and a credit card which you use and pay back in full every month

jn1 wrote: »

I am on over 90k p/a and have a 5% deposit (want to buy at circa 250k no more because of stamp duty)

This probably isnt as big an issue as you think it is, there's no longer a "cliff" of extra tax to pay if you go over £250k any more, as stamp duty increases changed several months ago.

jn1 wrote: »

I think the scoring system is crazy

There is no "scoring" system, credit reference agencies sell you a score because they have to try to make money somehow, lenders assess you based on their own decisions of the information on your credit file, not some arbitrary score.

jn1

kingstreet wrote: »

95% with adverse credit visible on your credit files isn't going to be easy.

At that level of income, a bigger deposit should be achievable within a short timescale, improving your chances of a mortgage and reducing your possible rate options.

Broker job, IMHO.

thank you very much for your advice

jn1

nidO wrote: »

From personal experience? Easy. I've applied for 3 in my life (all since 2009) and have been accepted painlessly for all 3.



Unfortunately your friend's advice has stiffed you. Having a history of using and paying back credit is a positive thing, but payday loans look bad to lenders as having a payday loan is a sign that you're in imminent financial trouble.
If you only have a minimal credit history you'd do better to get yourself a mobile phone contract and a credit card which you use and pay back in full every month



This probably isnt as big an issue as you think it is, there's no longer a "cliff" of extra tax to pay if you go over £250k any more, as stamp duty increases changed several months ago.



There is no "scoring" system, credit reference agencies sell you a score because they have to try to make money somehow, lenders assess you based on their own decisions of the information on your credit file, not some arbitrary score.

THANK YOU this is brilliant.. whats not brilliant is the pay day loan part.. so stay away from them and NEVER go there again yeah..

I'll just keep saving then.. o well

ACG

Defaults at 95%.
There is only 1 lender off the top of my head and I dont think they are particularly keen on Pay day loans - if there have been many and recent your friend may have caused more harm than good.

Get a broker and professional advice. The last thing you want to do is do something that kicks out the limited option(s) you have do currently have.

Thrugelmir

jn1 wrote: »

I am on over 90k p/a and have a 5% deposit (want to buy at circa 250k no more because of stamp duty)

With a little application and a tightening of household budget. Should be relatively easy for you to build your deposit fairly quickly. Unless you have other unsecured debts, if so these should be addressed first.

Foxy-Stoat_3

Another "Jack" for the rest of the MSE:

https://forums.moneysavingexpert.com/discussion/5233857

amnblog

PDLs to £90K pa in a few years


You need to write a self help book