First Time Buyers -Early Stages

afooksy

Hello All.


Myself & my partner are about to start the process of looking for our first home. Back in October, we got a DIP from HSBC based on us saving £15k. We currently have half of that saved so decided to book an apt with a MA to discuss the possibility of a 5% deposit.


I then logged onto this forum yesterday and have scared myself silly, I'm already anxious about this whole process and it hasn't even started yet!


Firstly, my credit is shot to pieces, I am on a Debt Management Plan and my credit history is littered with defaults (don't get a credit card at 18 years old!!). Luckily, my partners is excellent and the DIP was based on his credit history alone, but it included both of our incomes.
Naively, I assumed that the DIP was effectively all you needed to buy a house, how wrong I was! I am now scared that even though we have a DIP, will they search me as my income is included when we come to getting a mortgage offer?
My partner like I said has an excellent credit history, we rented for one year with no late payments (don't know if that sort of thing helps) and he has consistently saved between £600 - £2000 per month for the last year. He is worried about his bank statements as he does the occasional football bet on a Saturday though his phone, so it shows up - does that halt a mortgage offer?
I have rambled on so I am sorry and considering I haven't even found a house yet I am probably way ahead of myself. But this process seems so daunting I just want to know what the worst is that could happen!!


Advice from those in a similar position will be much appreciated!!

mrginge

A DIP is nothing more than a guide.
what is partners income and how much mortgage are you looking for?

saverbuyer

Honestly, I wouldn't bother going with HSBC with a less than perfect credit history. You'll not be able to count your income and not be named on the mortgage. I seriously doubt HSBC will offer a mortgage to anyone on a DMP. They seem to get the pick of the bunch.

afooksy

Thanks Both. The DIP kind of happened by accident as we both bank with HSBC and had gone in to set up an ISA. Whilst we did that the lady in HSBC was asking us what we were saving for and when we said a deposit she just asked if we wanted to know what HSBC would lend us, hence us being given DIP then.


Its going back a while but I am sure she did it solely in my partners name but accounted for both of our incomes.


We are visiting an independent MA this Saturday so I will explain my situation. By visiting an independent MA I assume they will search the whole market for DIP which will hopefully broaden our options.


mrginge- my partners annual income is £45k, mine is £21k. Looking to lend between £140 - £150k.

Malmo

HSBC will be a non-starter if you are applying jointly. Your credit history will preclude you from the customer profile they typically want to do with business with. Sounds like the member of staff you spoke with may have inflated the income under your husband's name by including what you earn. It doesn't work like that.

Speak to the broker on Saturday and see what options there are. Some lenders are direct only and don't distribute their products via brokers and your options (if applying jointly) may be quite limited because of your own history (DMP). Is your husband's income alone enough to purchase?

Contemptuous

I don't think a 95% mortgage will be achievable with your credit history, unfortunately. I believe the lenders who offer it are typically looking for customers with a perfect credit score due to the added risk. You'd have more options with at least a 10% deposit.

afooksy

Thanks Malmo. I think we will have to pin our hopes on my partner obtaining a mortgage based on his earnings alone. I'm hopeful about that has he has excellent credit history, no credit cards, no overdraft and earns over £40k a year. Obviously my name won't be on the mortgage though. Some people have mentioned that you can have it written into the contract about how I contributed so much towards the house, not sure how true that is.


I'll see how the meeting goes on Saturday, that should make things a lot clearer for us and what our options are.
Thanks for all your advice!

afooksy

Contemptuous wrote: »

I don't think a 95% mortgage will be achievable with your credit history, unfortunately. I believe the lenders who offer it are typically looking for customers with a perfect credit score due to the added risk. You'd have more options with at least a 10% deposit.

Thanks Contemptuous. We were initially aiming for 10% which we will have by June but just decided to explore our options a bit earlier. I have accepted the fact that I have 0 hope of getting a mortgage, but I didn't know if we could include my income but not be on mortgage itself. Sorry if I sound really naïve here, am FTB with no idea!