Arrears and default

jy327

Hi,

I recently applied for a mortgage after having an offer accepted on my dream house. Unfortunately mortgage was not granted as a result of the bank looking at my credit history.

I thought I had a clean history as I currently have no debts, no overdrafts, clear credit cards and a healthy sum to put down on a house.

Well I now realise I made a huge mistake by not running a credit check on myself before beginning the process and have now discovered that I have arrears dating back to 2011 on a Topshop card. The sum was minimal (less than £100) and after 4 months I began paying off the balance by direct debit until the money was cleared.

The other issue concerns an old T-Mobile contract on a laptop, which they say I cancelled with £75 still owing. My credit check shows this as defaulted in 2012. T-Mobile say the amount had never been paid but the recovery firm acting on their behalf say it has.

Anyway, I know it's common practice that these marks are not removed for 6 years but I'm confused as how can they can result in a mortgage application being turned down 4 years later when I accounts are in pristine order?

Have I got any chance getting a mortgage with these on my files or should I just give up now?

Thanks,
J

Candyapple

A mortgage is one of the biggest financial commitments you are going to make in your life and given the huge sums of money involved, it's no wonder banks require your credit history to be spotless for the best rates.

There is a small pool of lenders who will still allow you to have a mortgage if you have a default(s) on your history, but usually in return they require you to have a higher deposit and you won't receive the best rates. You should seek a mortgage broker to search whole of market for you rather than trying to apply to one lender directly yourself.

Even though your credit history may be clean 4 years on, it's still not 6 years which is what the lenders want. That's the criteria they set, nothing will change that.

AhaliaGal28

Hi My daughter has the same problem but the story gets twisted even more. She had a DRO in 2009 & finished in 2010. The DRO was on her credit report but has since come off.


Applied for a mortgage and was turned down twice despite having healthy deposit & wages. On her application she put down that she had no bad debt. She got quite upset and the broker told her to "check her credit report" even tho' she was saying she had no bad credit. He told her that unfortunately she had & that it looked that not only did she have bad default but she had tried to deceive the mortgage company.
Got a copy from Experian and on it says she has a debt of over £900 with TTI-SPC. which defaulted in 2010 (4 months after DRO made). She hadn't a clue who this was. Rang them & spoke to a very nice girl who was really helpful & told her it was a NEXT debt. he then rang NEXT to say that this had been in the DRO and should never have been put on her file (this was info she got from Insolvency Service & Citizens Advice Bureau) You can only register a default BEFORE the account goes into a DRO.
Hang on it gets even better lol. Spoke to NEXT and they said they didn't have the files (TTI-SFC had them) but she could confirm that they sold this debt onto them in.........2012!!
So NEXT sold a debt which had ben discharged in 2010 nearly 2 years after!! Sure there must be a law against this sort of thing. Will carry on the fight as it has cost me the house I wanted.
Thanks