Getting rid of Bad credit for a Mortgate! Please Help.

ArranJames

Hi,

For a brief period of unemployment and financial hardship, I have now been left with low credit score 600.

This recently has prevented me from passing any mortgage applications and is really having an effect on me personally.

There are 2 default marks on my credit file:

Payday express - pay day loan. Initial Loan was £100

Cabot financial ( Capital One Credit card) £300

I have settled both these accounts, However they must stay as defaulted.

Prior to this blip, i have had a good credit history. I have applied for various mortgages and none will take me with this default on my file.

These were such small loans, and to have them on my credit file for 6 years seems a long sentence especially when i have paid them what i owe, i still feel imprisoned to these loans and would never have taken them if i would of known the severe consequences they would have.

It has always been my goal to buy a family home, but these are preventing me from doing so. They both have 3 years left to run.

Things I have tried so far,

wrote them letter asking for mercy, no luck!

contacted FCA who cannot help with payday express, as i didn't follow up them after my initial letter.

I am now probably going to have to live in rented accommodation for the next three years! which is pointless and costing me alot. when i have a good job, a deposit, and solid employment. I feel this is very unfair.

Please can anyone help as to how I can get these off my credit score, and take some ownership to my life. Its getting me down how this stupid mistake.

Thanks

sourcrates

Hi,

Your only hope would of been to include default removal as part of any settlement offer you made the creditors, as you have already paid them off, that door is now closed.

Your stuck with them for the duration now I'm afraid, once 6 years are up, they will fall off your file as though they were never there, you will just have to weather the storm until then, there's no other mechanism for default removal.

Nebulous2

It might be worth posting in the mortgage section of this forum, as there are some brokers who post there and might give you some ideas. A mortgage is available for many people, though it may not be at standard rates.

My understanding is that a mortgage is possible with defaults over two years old. That may depend on what else is on your file. So get everything else right you can, electoral roll, no late payments, stay within limits, as big a deposit as you can ( you may need 15%)

Dobbibill

The information report on your credit file is supposed to be an accurate reflection of your payment history. The defaults are there as they are what has happened. There may be a way to get a mortgage through a broker, they will have experience & knowledge of what companies are likely to accept you rather that you doing applications blind.

Ignore you score, it's neither seen nor used to determine your eligibility for credit products. (plenty of examples all over the forum of posters with a 999 score and refused for bank accounts and credit cards etc)

Anthorn

ArranJames wrote: »

I have settled both these accounts, However they must stay as defaulted.

Why must they stay as defaulted? If you have settled them as you say, the "Default" status should change to "Settled". However the history of the accounts stays there. Settled accounts are actually part of most people's credit histories including mine: I have loads of them.

ciderboy2009

Ignoring the defaults for a moment - the fact that you've got a payday loan showing on your file is going to be a problem with getting a mortgage.

Westminster

Instead of blindly putting applications in (each of which will be detrimental to your credit history) you should contact an independent mortgage broker (i.e. not one in a bank or estate agent) who specialises in adverse credit.

They will take copies of all of your credit files and will use their detailed knowledge of various lending criteria to find you a lender who will accept your case.

ShivasPlace

ciderboy2009 wrote: »

Ignoring the defaults for a moment - the fact that you've got a payday loan showing on your file is going to be a problem with getting a mortgage.

This is unfortunately very true - with most lenders giving a straight "no" if the Payday loan was within the past 12 months.

I can think of a lender that will 'consider' applicants with payday loans over 6 months old, but as Nebulous2 says, you won't get high street rates and you would be best posting in the Mortages forum and/or going through a broker.