Payday Loan Anxiety

stonehedge

Hi,

We are about to instruct a broker to help us find a mortgage.

We have a 20% deposit and my wife has an excellent credit history. I on the other hand fell into the payday loan trap and have numerous payday loans on my record, the most recent of which is over three years ago. I have no missed payments, defaults or CCJs. The only negative on my credit record is my past reliance on payday loans.

I am terrified that we won't be able to get a mortgage for another three years before they fall off my record. The irony is that my past financial difficulty was what drove me to change careers and over double my income leading to three years of prosperity.

Are we doomed? Any advice? I want to do everything I can to prevent my past stupidity affecting our future.

AnotherJoe

As this was three years ago I wouldn't have thought it should be an issue, and whilst its difficult to do this, there is no point worrying about things you cannot affect.

I would be fairly positive that this will turn out to be nothing, but suppose the broker says "well lenders 1, 2 and 3 wont lend to you but 5,6,7 & 8 will" then you'll know what your position is.

Look at it this way, there are plenty of people with far worse financial issues that you who manage to get mortgages, so even if you cannot stop worrying, logically your worries are far overblown and using words like "doomed" doesn't help. Good luck and let us know the outcome.

Barpeeler

I'm in a very similar position and once we get a decent deposit together later this year will be hoping to apply, would be interested to hear how this goes for you.

Good luck!

amnblog

PDL's are never a good idea but these are historical and I don't see them being a barrier to you obtaining a mortgage.

stonehedge

Thanks for your positive replies.


Our broker has recommended going with Accord. I will post here with updates.

stonehedge

Got a lending agreement today (which is what Accord call a AIP/DIP). I think it is just a credit check and a once over of the high level figures.

Our broker submitted the full application today too. Lets see where this goes.

stonehedge

For the record, I'm still really worried but I'm managing to relax a bit more. We are really sick of paying rent but what will be will be.

Barpeeler

Good luck hope it goes well

stonehedge

Quick update. Our broker spoke to Accord this morning and assures us that we have passed underwriting and we are good to go subject to the valuation that is happening tomorrow.

I can't quite believe it, in fact I don't. I don't think I'll believe it until we have the keys in our hands.

Thanks for the words of advice and support. If this does go ahead it proves all is not lost if you got yourself in a bit of a pickle in the past.

Debtslayer

Congratulations. Fingers crossed everything goes well for you :beer:

stonehedge

I thought I'd post a final update here for completeness.

We received a full mortgage offer from Accord with no queries about my previous payday loan history. In fact, the only underwriting query was why my wife tends to pay off her credit card in full a few weeks before her DD is due :P

Whilst nervously waiting for the decision I studied my credit report more closely and saw that I took 33 payday loans between Jan 2010 and Jan 2013. I can't believe that I became so dependent on them but as I mentioned above, my low income and poor discipline are what convinced me to start my company and turn my fortunes around.

I can categorically confirm that the advice above is correct. Payday loans aren't the end of your mortgage hopes IF they were historical and you have shown signs of financial improvement since. A good broker is invaluable too.

Thanks to everybody for the advice.