Pay day Loans

treedog51

Hi first post and very ashamed.

I have in the last year had some payday loans whilst being a student, I now know this was stupid and I honestly thought if I paid them back on time they wouldn't have an impact on anything.
Any way I did a credit report though Experian and the pay day loans did not show up..... checked all the address were correct all the info was on there can anyone shed light on why this happened? I then did a report with Equifax and they showed up on there.

Secondly, does anyone know how soon, if at all, when I would be considered for a mortgage, I earn a good wage now as does my partner.

Have I messed this up for life or has anyone had any experience of this?

Any helpful advice gratefully received.

Thanks

Lilla_D

Unfortunately it's quite common that the credit files don't show certain things or show something incorrectly. If you spot an error, you should call them and ask for a manual update, because lenders can quite often see stuff that is missing when you view the file.

There are lenders who are not willing to consider applicants with payday loans in the past, while most can accept it after a while, especially if they all happened around the same period for one reason or another. Generally speaking you should have the last 2 years prior to a mortgage application clear.

ACG

You will be fine, it wont be for every lender but there should be options at normal rates.

Sometimes credit agreements only show up on some of the credit agencies (there are 3 in total). However, you should no rely on this and find a lender where it fits criteria rather than hope it sneaks through. A Broker will be able to help you find the right lender.

Best of luck, I am sure you will be fine however.

Neutrinno

When did you take them out? I'd have to disagree slightly with Lila, I think 2 years may be a little excessive. As ACG said it may not be for every lender, but generally 6-12 months clear will be enough and normal high-street rates should apply provided your credit has been kept well since.

aneary

I was told by a broker that I couldn't get a mortgage until 12 months after the last payday loan (July).

However the payday loan company do not report to equifax so I have applied for a mortgage with Leeds (they only look at equifax) I have a mortgage in principle but I'm worried that the full application will be rejected.

ACG

Your broker has potentially given you wrong information. Although the 12 months may be for you - ie there is something else that knocks out the lender(s) who would consider PDLs less than 12 months old.

I do not use Leeds a lot so I can not really comment, but I would always try to find a lender where you fit criteria rather than hope something does not get picked up.

aneary

I wasn't particularly happy with the broker I was going to be charged £1k in total and he said everything was fine that he would easily get me a decision in principle using another broker. Then came back and said yes I have got you a DIP you just need to get your parents to give you another 10k.

My equifax report is rated as excelliant

ACG

It frustrates me when that happens. Every lender has an affordability calculator, so we can find out what the lender will lend without needing to do a DIP.

aneary

I don't think the DIP was ever processed, I went to MA1 who said everything would be fine. Then MA1 said actually no wait until July when the payday loans are off your file, I explained that my tenancy agreement ended in August and I didn't want to sign another one for 6-12 months. So he said that he would speak to a specialist MA2 and the total fees would be around £1k he came back with to possible mortgages with different rates and said which one would I want, I picked one then said they would get the DIP no problems etc. Then the following day said oh we have got the DIP but you need your parents to give you another £10k (my parents are giving me £10k so his suggestion was for them to double this) the way he said it was as if he was asking for my parents for give me another £10 not £10k.

In the end I did a little research and applied with Leeds my original DIP was for a total property value of £160,000 with a £22,000 deposit the flat I put an offer on was less at £145,000. They have done a hard search I can see it on my credit report I can't see a hard search for any other company so I don't think the MA ever actually processed a DIP.

The MA adviser said we would speak again in July, I don't think so, I know he is probably a really bad example but he has put me off MAs.

treedog51

Thanks for the reply,
I am in contact with a MA who did a DIP that went through, she said we could try the full application but it may get turned down so didn't know if it was worth even trying the last pay day loan was pretty recent I've seen on other threads that the DIP doesn't really stand for much?
I think I'm best to wait it out for a few months then see what happens.
My MA said the bank don't do a further credit check after the DIP but the case would be looked at by an underwriter which is where the issues may get thrown up.
You have restored my faith in the situation though think it may be best to wait 12 months and live on a shoestring to prove I'm in the all clear hopefully