FTB with £30k deposit but also a default

bobbadog

Hiya

I wondered if anyone could offer us any advice...

Myself and my OH earn around £50k between us per year, and this time next year we're hoping to have £30k to put down on a house as a deposit. We're looking to borrow a max of £160k for our first mortgage.

The only problem is, whilst my OH has an impeccable credit report, I have a credit card that defaulted whilst at University. I've since won charges back on it, but the default will not drop off until 2010 and we're looking to buy in 2008. How much of a problem will this be for us? Is there anything we can do? Should my OH be the soul mortgage person and not me?
My credit file is perfect other than this, as I have very little credit (£600 credit card, £300 left on an old loan, all perfect) but i'm a 1 star person.

Any advice greatly recieved! x

herbiesjp

Has the default been satisfied?

You do not have to wait until the default disappears from your credit file before you can apply for a mortgage.

How much was the default for? Who was it with? It looks like you will be applying 4 years after the default in 2008 and I would think you should be able to get a normal high street deal as well.

You could try to improve your score by paying for little things by card, but remembering to clear them each month - that way it shows you are good with your repayments. Whatever you do, do not build up huge balances, as these will decrease the amount of mortgage available to you.

Are you looking to stay in South London?

bobbadog

herbiesjp wrote: »

Has the default been satisfied?

You do not have to wait until the default disappears from your credit file before you can apply for a mortgage.

How much was the default for? Who was it with? It looks like you will be applying 4 years after the default in 2008 and I would think you should be able to get a normal high street deal as well.

You could try to improve your score by paying for little things by card, but remembering to clear them each month - that way it shows you are good with your repayments. Whatever you do, do not build up huge balances, as these will decrease the amount of mortgage available to you.

Are you looking to stay in South London?

Hiya! Thank you for the quick reply - yes, the default was satisfied in April 2006 and then I won charges back on it earlier this year. It's been marked as satisfied since april 2006 (and partially satisfied before that). The default was £604 with Capital One, but the original amount was just £200.

So in the short term, is it sensible to say, buy all my shopping on my CC and clear in full every month? Will do that as soon as I get my current CC down to 0 (it's at £500 at the moment).

We're either moving home to Northampton and commuting back to London for work, or buying a small 1 bed in London and hoping to add value - at the moment slightly undecided. Am impressed that a High St lender would even consider us! Very relieved. x

Badger_Lady

As long as the default is satisfied (or close to), you will get a mortgage, although you won't know which ones until you apply...

I had a default on my credit record caused by my ex on a joint account (grrr...), and was therefore refused by a few mortgage companies, but I got my new mortgage offer from the Halifax on Monday :-)

It sounds like you're in a good position, so I say go for it and see what happens! If you use a whole-of-market mortgage adviser, he can back you up with the application and explain the reason for the default to the underwriters, which will be helpful in getting their approval.

The fact that you are FTB and have such a healthy deposit should show that your money problems are in the past.

bobbadog

Badger_Lady wrote: »

As long as the default is satisfied (or close to), you will get a mortgage, although you won't know which ones until you apply...

I had a default on my credit record caused by my ex on a joint account (grrr...), and was therefore refused by a few mortgage companies, but I got my new mortgage offer from the Halifax on Monday :-)

It sounds like you're in a good position, so I say go for it and see what happens! If you use a whole-of-market mortgage adviser, he can back you up with the application and explain the reason for the default to the underwriters, which will be helpful in getting their approval.

The fact that you are FTB and have such a healthy deposit should show that your money problems are in the past.

Thank you Badger Lady! I sure hope so. The debts I have now are all minimal. I'll be back on here asking all of your advice when we hit our £30k target!!! Many thanks x

bobbadog

Just a thought - is it worth having another (hideously rated) credit card - like a 29% one to pay off in full every month - (and I mean to pay in full!) - will that show my responsibility more than my current one does? I'm not quite in the position to clear my only card at present (but will before Xmas) x

apk1

I would'nt worry too much about getting another card, just use one card as much as you can, and ensure fully repaid each month.

It is important to be on the voters roll, so ensure you are registered.

You say you won charges back, this would sound like some kind of dispute, if so you can get a notice applied to your credit file with your side of the story which may help.

Also given that the default was satisfied 2 years prior to the anticpated application it will make little difference overall.