Turned down for a mortgage - Advice needed please

Nafrayu

Hubby & I were declared bankrupt in 2010 following a business being closed down. We were discharged the following year. Due to debt because of the bankruptcy the trustees decided to sell our house in 2013. We moved out into rented accomodation in March that year. Up until that date we had been paying our mortgage.

The house was subsequently sold in July that year and the mortgage paid off. There was 2-3 months that the mortgage was not paid as we had moved out. As far as I can remember we were advised not to pay the mortgage once we had left the property although I cannot find this in writing.

We have been looking at buying a house and saved a deposit of 5% which is what most companies seem to want. Today we got turned down and no appeal by Nationwide due to these couple of months.

We both have decent credit ratings and for the last year I have had a credit card that I've paid in full each month.

We really want to get on the property ladder again.

Please can anyone offer any advice. We're waiting to see what our Indepndent Financial Advisor recommends also but I would really like to know what you think.

Many thanks

Natasha

Hutch100uk

I'm no expert and you really are best talking to a broker but, my experience recently has shown me how hard it is to get a mortgage.

Both mine and my partners credit files are squeaky clean with no late payments or defaults. I only have £2.5k on credit cards and that's about it.

We have a 5% deposit but Halifax have come back and said they wouldn't lend us enough even though the affordability check said we may be able to borrow £30k more than they are actually offering.

My broker said it could be their scoring system - maybe cos my partner hasn't been in his job long enough, our childcare payments, my credit cards, moving house too often etc etc.

With your bankrupcy and defaults, I think you would struggle especially if you only have a 5% deposit. 95% mortgages are VERY difficult to get as its a higher risk to the lender. I think you would need a lot higher deposit before lenders would consider you.

barba

Nationwide are the harshest of the harsh so not surprised.

Did you get your credit files beforehand and cross check against the criteria?

As noted 5% plus checkered history points to a major risk for any lender.

I think you might need 15% deposit

alchemist.1

This is something a bad credit specialist broker will be advise you on. It seems you think even after being declared bankrupt you still have a decent credit rating. This is certainly not the case.

David_White

Nafrayu wrote: »

saved a deposit of 5% which is what most companies seem to want.

As a minimum.

You may find you have an easier ride putting down a 10% or 15% deposit as this poses a relatively smaller risk to the lender and shows a bit more willing on your part.

Historic bankruptcy and missed mortgage payments aren't impossible to overcome but I would suggest talking the case through with a broker that deals with these types of situations.