Mortgage Questions

luis1988

Hi everyone!

First time posting in this forum, just have a couple of questions:

How far back do mortgage lenders usually check on your credit file? A friend of mine recently purchased and he said theirs (Halifax) checked two years, is this the average? We will probably be using Santander to let you know.

Also, does your credit score/history have a baring on the interest rate? I keep seeing very low interest rates advertised but wasn't sure if these change after the scoring stage? I have a score of over 900 on Experian (I know these are only a guide) so was wondering if this could make a difference?

Thanks for any help in advance !

amnblog

Your friend is wrong. Lenders can and do automatically check back six years.

Your credit history sounds clear, so subject to other factors such as income, deposit, and security property, you should have a wide range of options.

HappyMJ

It depends on the lender and the seriousness of your credit issue.

One or two late payments over 2 years old will usually be ignored.

An unpaid CCJ that is 5 years old would not be acceptable to many lenders.

Thrugelmir

Lenders can access data that dates back 6 years, i.e. 72 months. The data will scored internally against the lenders own criteria. The mortgage product choosen will have a bearing on the interest rate. The credit scoring process merely forms part of the checks conducted that ensure you are a suitable as a potential borrower.

luis1988

Thanks for the quick replies, it's amazing how helpful everyone is on these forums!

My credit file has been vastly improved in the last few years, I had 2/3 late payments 2/3 years ago but nothing serious like defaults or CCJs and I think my latest Experian score reflects how I have rebuilt my credit file.

So from what I gather, the interest rate that is advertised (and subsequent repayment calculator figures etc) will be the final interest rate I will pay and my credit 'score' will not affect this? I just want to be sure as we are calculating our outgoings each month and don't want a surprise hike in the interest rate we may be given as it can have a huge effect.

Also, and by all means shoot me down if I am invading privacy, can anyone give me some examples of amounts they have paid after the fixed period ends? I know it is impossible to say what we may pay in 5 years time after the fixed period, but it may be helpful if someone could give me an example of their situation, i.e. paid £xxx during 5 year fixed and £xxx after the 5 years finished with rough dates.

Many thanks again!

amnblog

When you take a mortgage deal on a five year fix, part of the contract will be the rate you would move onto afterwards.

This rate is not affected by your credit profile.

Most lenders currently put borrowers on to a rate of between 3.99% and 5.79% depending on the lender. The borrower also will usual have the option to take another short/medium term rate.