Will late payment scupper mortgage chances?

jo3ler

Hi guys

Wonder if someone can help.

Shortly due to be applying for Mortgage AIP. Only real negative on my Experian & Equifax credit report is a late payment marker (with the number 1) on my VW car finance from February this year. Is all up to date now just paid one payment a little late (within a couple of weeks) All because I left my wallet on a plane and it took me over a week to get it back. I’m self-employed and couldn’t pay myself on time, don’t have telephone banking even though I do have internet banking. Probably could of gone into a branch to sort it but failed to do that. I didn’t have enough in my current account near the end of the month to cover the payment of £294 and so it was paid late. Once it’s over 6 months old (any day now) Experian say it doesn’t have a negative effect on my rating from their point of view although obviously it’s still visible.

Ever since I have been paying down debt and keeping everything clean in anticipation of mortgage application. I don’t have any defaults, CCJ’s. Good rating with experian and excellent with Equifax. My debt to limit ratio is under 40% and I will have no outstanding debt by the time I actually apply for a mortgage.

I have good earnings as does my wife and we will have just over 30% (£200k deposit for £650k house). Affordability already checked out and okay’d by whole of market broker.

Is the late payment gonna stuff me from getting a decent rate? The broker I have spoken to says they aren’t sure what effect it will have until I apply! Are they just rubbish or is this the case?

I appreciate it’s my fault and have asked VW finance nicely if they’ll remove it which I know is totally discretionary.

Appreciate any help.

Thanks guys

P.S I have seen some posts on here which indicate that late payments marked with 1’s aren’t visible to potential lenders or don’t matter and they don’t care – I am hoping this is true but guessing not!!!!

Thrugelmir

Obvious concern for a lender is that if cannot afford to pay your car finance then how would you pay the mortgage some months. You may have plenty equity but no savings (to cover such a small amount). Focus on getting your finances into shape. Time will heal your credit profile.

jo3ler

Completely agree which is the reason for this post. However this was 6 months ago, and in that time I've paid off £20k of debt, will have around £15k in savings excluding move costs, with zero debt by the end of Sept, except potential mortgage and a decent salary. Forgive me but my finances are sorted barring this. My question was related to the late payment and how that will affect things based on its age. Everything else is as ship shape as can be. The deposit equity is also cash, not property equity. Well aware of time being a healer. But need to move before Christmas ideally. Hence the question. Thanks for taking the time to reply.

amnblog

Don't see this tripping the case over in itself.

For extra confidence, use a broker to manage it for you.

jo3ler

Thanks, I've spoken to several whole of market brokers and given them everything they need to asses the situation. Hopefully all is well but thanks for the confidence boost