Poor Credit score - DIP obtained via broker - reliability

chromac

So quick rundown, me and my partner are looking to buy our first house.

I earn £42,000, partner earns £11,000 (part time) - looking for a mortgage of £210,000 on a property valued at £272,000.

My credit score is poor - due to a (settled) defaulted account last year.
Her's is pretty stellar - so not an issue.

Our affordability was good - and we obtained a Provisional DIP accept via Barclays subject to underwriter approval on seeing some payslips etc.

This DIP produced a Hard Search on my credit report.

SO my questions are; I assume that because a hard search was performed they would see my defaulted account and chose to accept anyway?
How accurate is a DIP? I hear so many things, but couldn't find a scenario on the web that was like mine. And I would be devastated if my mortgage app gets rejected
Has anyone heard of a 'normal' (not a bad credit) mortgage been approved with somebody who has defaults on their report.

Thanks in advance for any help etc.

Senior_Paper_Monitor

Value of default / date of default / date of settlement / Full or partial settlement ?

chromac

£201 settled in full straight away, 7 months ago - O2 phone bill.....

ACG

It fits criteria. If it has passed it should be fine.
Fair play to your broker, they sound like they have done a decent job as some brokers would submit that to an adverse lender.

chromac

ACG wrote: »

It fits criteria. If it has passed it should be fine.
Fair play to your broker, they sound like they have done a decent job as some brokers would submit that to an adverse lender.

I found the barclays woolwich intermediaries adverse criteria on their website last night and found the adverse credit criteria which relaxed me a bit - the only thing that worried me was the statement:

Decline if - "Satisfied defaults* totalling more than £200 and the latest is registered within the past 3 years"

But surely they would of seen the default of £201 upon doing a hard credit check......

ACG

I thought it was £250.
Is it a low loan to value?

chromac

ACG wrote: »

I thought it was £250.
Is it a low loan to value?

woolwichintermediaries.co.uk/Residentiallendingcriteria/IP1242620533007

Its help to buy equity loan - so the mortgage is for a value of £204,000 - against a house price of £272,000 - with us putting in 5% and the equity loan making up the other 20%

Senior_Paper_Monitor

As Chromac says, this is technically just outside criteria (this just shows how 'the devil is in the detail' - hence my original question #2).

I still reckon its a good call by your broker whether it works or not (and if it works - which I think it will - a damn good call and you owe him/her their fee and a few beers !). Its one I would have floated past our BDM before giving it a go - and I suspect your broker did.

I am a little concerned that you say your credit score is low - but this is probably another example of what !!!! 'credit scores' are and how the data in the hands of a good experienced broker can give a totally different meaning.

I would be fascinated to hear how the gamble works out

Thrugelmir

chromac wrote: »

This DIP produced a Hard Search on my credit report.

From the Barclays website.

Worried about credit searches?

Unlike making an actual mortgage application, we don’t run a full credit check on you for an Agreement in Principle. All we do is record a quotation search – that means we’ll take a look at your credit file to see if it matches what you’ve told us.

chromac

Senior_Paper_Monitor wrote: »

As Chromac says, this is technically just outside criteria (this just shows how 'the devil is in the detail' - hence my original question #2).

I still reckon its a good call by your broker whether it works or not (and if it works - which I think it will - a damn good call and you owe him/her their fee and a few beers !). Its one I would have floated past our BDM before giving it a go - and I suspect your broker did.

I am a little concerned that you say your credit score is low - but this is another probably example of what !!!! 'credit scores' are and how the data in the hands of a good experienced broker can give a totally different meaning.

I would be fascinated to hear how the gamble works out

Well I'm getting all the payslips etc. in order and we are submitting the application on Friday evening as soon as we have finished.

On looking at my report, he suggested a few things I needed to do, (electoral roll!!) etc. and stipulated that my score was probably low due to that, the default and 1 missed payment on a credit card last year.

Upon discussion he assured me that the system he uses (MAX?) is a very good indicator of a mortage proposal, as its quite thorough and assuming we can back up my salary and rental payments with the right documents - then we should be good to go.

Fingers crossed

Senior_Paper_Monitor

I wrote my previous comment before seeing it was HTB - I think its outside HTB criteria (we rarely do HTB so am not sure and that definition appears to have gone from the HTB site - where's Kingstreet when you need him ?).

I could envisage this not being picked up at initial stage by automated credit check but subsequently failing manual - but probably still worth a punt.

I remain fascinated to hear the outcome (and am sorry to add to your stress).