Will anybody touch us with a barge pole?

keales19

Hi All,

We have rented our house for the past 11 years and have recently been offered the opportunity to purchase the property from the owner.

We were not particularly clever with our finances in our youth, hence the long rental period, but have worked hard to clear as much as we can. Ideally, we wouldn't be looking to apply for a mortgage until next year as there is still some adverse marks on our credit file. However, the landlord wishes to sell this year and if we are unable to obtain a mortgage, we may be forced out of our home.

So, the question is, is it doable? The situation is as follows:

i) I am a stay at home mum and my husband works full time and earns £42k per annum.
ii) After all of our outgoings, including shopping, fuel, bills, rent, etc. we have £500 disposable income per month.
iii) The owner is willing to sell the property to us for £100,000 and we have a deposit of £10,000 which has been gifted to us from inheritance.
iv) We are looking at a 30 year mortgage as we are both young enough to get that completed before we retire.
v) In terms of affordability, we currently pay £450 rent pcm, and have done for the past 11 years, without it ever being late. We calculate that for the mortgage we are after, the repayments would be around the same amount (over the preferred 30 year term).

Our current credit file situation (across all 3 CRAs) reads as follows:

i) 2 unsatisfied defaults, both placed in early 2012, one for £116, the other for £4,607.
ii) No CCJs, no late payments.

Will anyone grant us a mortgage? Any help or advice would be greatly appreciated.
Many thanks in advance.

K

Dird

(Text removed by MSE Forum Team)

There's plenty of fine houses around the £100k mark when you don't live in London/surrey

keales19

The key lesson we have learnt over the years is just because you can, doesn't mean you should.
We have made a lot of memories here and, although it may not be our house (yet!), it is our home.
Bigger and better things, including houses, are in the years to come.
I should also say, the house has been valued at £115k, but the landlord is offering it to us for £100k.

K

keales19

We rent our house through an agent, the contract runs for 12 months at a time and was last renewed in October 2014.

Our agents contacted us and said that the landlord had been in contact saying she wished to sell the property at the end of our current contract period or ideally before, by mutual arrangement with us. It was at this point that we were offered first refusal on the property.

Our agents, with our agreement, came out to value the property with us present. Of course, they were not able to divulge the figure before speaking with the landlord, but once informed, our agents again contacted us quoting £115k as the open market value, but the landlord would be willing to sell it to us for £100k, if we can complete ASAP.

amnblog

back to the point in hand.

Options will be slim but you might get yourself placed through a good mortgage broker.

keales19

amnblog wrote: »

back to the point in hand.

Options will be slim but you might get yourself placed through a good mortgage broker.

Thanks, we will most definitely be using the services of a broker, I know the high street lenders wont touch us, lender wise I have found Kensington & GE Money may be able to help.

I appreciate it is difficult without all of the facts and figures being presented just hoping for some opinions on what are chances are.

amnblog

You are hunting in the wrong direction, engage a broker - your chances are slim but they exist.

PixelPound

A full market broker is best - use website like unbiased.co.uk. There are threads on here on how to find a good broker and what to look for..
With £42K your affordability should be okay, though you may want to use some of the detailed calculators on high street lenders, so to factor in all your outgoings.

The problem will be the 2 defaults because they are unsatisfied.

Teqpro

There's lots of people worst off, you should immediately pay the £116, ring them and say you only have £100 and would they mark it as satisfied on your credit file.

As for the other default; offer them £2000. I think its worth it for a £100,000 property.

amnblog

They don't need to be satisfied - you just need a lender who will live with them

amnblog

nic_c wrote: »

A full market broker is best - use website like unbiased.co.uk. There are threads on here on how to find a good broker and what to look for..
With £42K your affordability should be okay, though you may want to use some of the detailed calculators on high street lenders, so to factor in all your outgoings.

The problem will be the 2 defaults because they are unsatisfied.

High Street lender calculators are not relevant. Lenders that will accept the defaults as this loan to value will be more conservative with affordability.