Advice wanted please?!

Sandyhouse

Hi there

Thank you in advance to anyone who takes the time to read our post. Looking for a mortgage and not got a lot of time to spare.

We purchased our first home two years ago with a £30,000 deposit, and. Ow have an outstanding mortgage of £102,000. At the time my hubby had a perfect credit rating but mine was not so good, so we felt very fortunate to have obtained a mortgage.

Shortly after moving in, my hubby lost his job and was out of work for four months. We had already booked our wedding for the following summer so we struggled on through, using credit cards and overdrafts to get by.

We now wish to move on ( turns out the neighbours on our current street aren't great!) we have been on the market for 6 months without even a viewing and so we approached a new build company who made us a fantastic part exchange deal (£20,000 more than we paid two years ago) so we decided to bite the bullet and apply for a mortgage with Halifax ( mortgage will be £187,000 with a 15% deposit, our current lender does not accept mortgages over 80% LTV).

To our amazement, we were offered a Dip for up to £260,000 and we instructed solicitors and paid a holding deposit. Since then we have been told by Halifax that they will not honour the Dip and will only give us 65% ltv.

We are now in a bit of a panic as we have to complete by 26th June and don't really know what to do next. the Halifax search was only a soft search so has not appeared on our credit file, but we do have a few issues on there:

Mine: 3 defaults, one is 5.5 years old the other two are 3 years old and satisfied
No adverse credit in over two years

hubby has 1 AP and 5 late payments (1's) in last 12 months

Halifax have told us it's the late payments, not the defaults, that are the problem.

Any advice would be welcome. We intend to speak to a mortgage broker tomorrow, but don't really know where to start...

Sandyhouse

Sorry, I meant to add that debt from credit cards & overdrafts totals £11,000 but will be paid off from the equity released

amnblog

Halifax don't know what is actually the problem as it is an automatic score.

Most likely the issue dragging down your score is over 3 years old as that will not have been picked up at initial decision stage.

Engage a whole of market broker immediately.

Jon_B_2

I wouldn't panic that much as you obviously haven't exchanged. So even if this house doesn;t work out, you still have somewhere to live.

ACG

You partners late payments could potentially be a bit of an issue for this as it will depend on how they appear on his credit report... I found out last week there is an EU directive where if you are classed as credit impaired (anything more than a 2 on the credit report in the last 2 years) no lender can accept for affordability purposes that the debt consolidation will actually happen.

It sounds like that may not be an issue but its worth baring in mind.
Also depending on how it appears on his credit report any lenders that use help to buy to fund their 85% products may need to be discounted.

Definitely one for a broker but I would say assuming affordability is not an issue, then you could probably get close to 85% LTV with 1 or 2 lenders but I do not think it would be high street rates (may be up to 5.5%, although potentially less).

You need to speak to a broker ASAP as time is getting tight.

Sandyhouse

Thank you for the advice guys.

Nothing above a 1 in the last 12 months on any of the three files, just 1 occasion each on two credit cards of a 1 and three 1 s on a mail order - all on direct debits now so that minimum payments won't be missed again!

Can anyone recommend a broker? As ACG says, we would like to get moving on this.

ACG

Is there anything above a 2 in the last 2 years? Thats the important bit as thats help to buy and an EU directive which over rules anything a lender would want to do.

Sandyhouse

Nope nothing in the last two years over a 1


Where do we start looking for a broker?

Thrugelmir

Sandyhouse wrote: »

Sorry, I meant to add that debt from credit cards & overdrafts totals £11,000 but will be paid off from the equity released

Lenders may consider it irresponsible to simply consolidate this debt and allow you to borrow even more.

What was this for?

hubby has 1 AP

Sandyhouse

Most of it was accumulated due to some very bad advice on our house purchase two years ago, when the FA messed up by several thousand in his estimation as to how much we needed - his solution was to tell us to "stick it on a credit card"

We are keen to move and start afresh, and are acutely aware that we are running short on time. I do not know of any good brokers and following our bad experience last time I'm anxious to make sure we find a reliable broker!

ACG

Avoid estate agent brokers.

Maybe just jump on google and look for brokers in your local area?
Have a chat with them and see how they are with adverse whether they have experience in it.