Mortgage & DMP

Andos_2

Hi All

Firstly, I'm sure this has been asked numerous times and apologies if that is the case.

My girlfriend may be enrolling on a DMP to resolve her finances.

I however am currently looking to save via the Help to Buy ISA for a mortgage deposit over the next couple years.

She earns approx £7k working part-time and myself £28k-£30k full-time.

In say 2 years when she has maybe 1 or 2 years remaining on the DMP but I have enough saved for a deposit - How much affect will her DMP have on the mortgage process?

Am I best seeking a mortgage in my own name or are the advisors a bit more open to looking at incoming vs outgoing despite the fact it's a DMP?

Thanks in advance for your advice.

Regards

Pixie5740

Are you financially linked to your girlfriend in any way? Any joint current accounts for example? If so then her DMP will impact your credit file.

If she has entered into a DMP that would suggest that she is unable to make the minimum repayments on money she has borrowed. She has either defaulted or about to default on these accounts...not the kind of thing a mortgage lender would be keen to see on her credit file.

When the time comes it might be better for you to buy the place on your own as her being on a DMP could make getting a mortgage difficult. Consulting a mortgage broker nearer the time would be your best bet.

Andos_2

Hi Pixie - Thanks for the reply firstly.

We haven't a joint account of any type so not financially linked. However, we live together in rented accomodation currently?

Indeed - Understood, I imagined that may be the case, however I will have to likely have a larger deposit to go it alone, as based on say 4-5 x salary I'm looking at a £120k - £150k house which in this current market isn't going to get me 3 bedrooms as required.

Wasn't sure if anyone had any experience consulting over a mortgage with a DMP?

piggeh

Does she have any recorded defaults on her credit file from outstanding debts? I would think that would have a greater impact than the DMP itself.

Pixie5740

Andos wrote: »

We haven't a joint account of any type so not financially linked. However, we live together in rented accomodation currently?

Sharing an address does not financially link people, having joint financial products does.

piggeh

I would recommend seeing a broker now and asking what needs to be in place in two years time to give you both the best chance of getting a suitable mortgage.

I was on a DMP but I underestimated my outgoings so it did not pan out as well as I hoped! (went bankrupt in the end). It is best to have a good understanding of your current situation so you can react to any changing circumstances between now and mortgage application.

My broker told me that my bankruptcy would not cause any issues on getting a mortgage because there are a wide range of specialist lenders if things do not work out well with the usual bunch. Similarly they may be able to advise if there are lenders where a DMP wouldnt be an issue.