Sorry, another "what are the chances?" question..

bluey1406

So yes sorry, I know that there are a lot of these but this is our situation.

We currently own our own (mortgaged) home. Current value is £275,000 ish and current mortgage balance is £115,000.

We were in a pickle 2/3 years ago and missed some payments, but we are now up to date and no late payments in last 2 years.

The same applies to a house OH owns and is rented out on BTL. Some late payments but up to date for at least the last 2 years. This mortgage balance is £111,000 and value is around £175,000.

We have good incomes of £46,000 and £28,500, although this has only been in the last year or so as OH got a big promotion and I began working full time following being a student.

We currently have around £25,000 in unsecured debt by way of a car loan and credit cards, all of which will be repaid when we sell. We have no defaults/missed payments on any other commitments, but one CCJ which is now three years old for £6,000. We have been paying this back monthly but haven't managed to repay in full yet, but again would be repaid on sale.

We do not want to buy a big house and increase our mortgage either in terms of balance or in term, but we would like to move.. We would like to use our current equity which will be £120,000 after repaying above debts and to then buy for max £220,000 but actually probably less (we fancy a project/something to do up a bit) so we are likely to want to borrow somewhere between 25-50% LTV - would prefer to keep it nearer the 25% mark, but def not over 50%.

To what extent will the positives (no continuing credit commitments, good income, big deposit) offset the adverse credit history? What "are the chances" of someone lending us 50% or less?

I know that we will probably need to use a broker but any initial thoughts or guidance would be much appreciated.

Many thanks

Nebulous2

I've no idea on your mortgage. Definitely use a broker used to dealing with adverse.

However I'll make an observation and note some key info missing.

To improve history you need to reduce negatives / increase positives. Move heaven and earth to pay off that CCJ now. It's a huge red flag.

Are you selling both properties?

If not then the BTL needs to be rock solid. How much cover does it provide eg What is the rent and how much is the mortgage?

bluey1406

Has anybody used these brokers and can comment upon their service? Thanks

ACG

There will be options, but the rates may end up being more than the high street lenders, potentially worse case scenario of around 4% - but that does not mean you can not get a high street Mortgage.

It is probably not a bad idea to speak to a broker just to avoid the stricter lenders.

bluey1406

ACG wrote: »

There will be options, but the rates may end up being more than the high street lenders, potentially worse case scenario of around 4% - but that does not mean you can not get a high street Mortgage.

It is probably not a bad idea to speak to a broker just to avoid the stricter lenders.

Thank you, that's helpful. I have been communicating with a broker at Creat who seems pretty positive. So far he has been very helpful in responding to emails etc. I spoke with him on the phone today and said that their fee is £999; £299 upfront and refunded if they don't get you an offer and the th balance of the £999 payable if they do. He also however mentioned that this fee was based on us agreeing to some mortgage "insurance". I have looked at review of them online which all seem very positive but I am a little cautious of these and wondered if anyone had any direct experience with them?

Fisa002

bluey1406 wrote: »

I spoke with him on the phone today and said that their fee is £999; £299 upfront and refunded if they don't get you an offer and the th balance of the £999 payable if they do. He also however mentioned that this fee was based on us agreeing to some mortgage "insurance".

:eek:

Blimey!. Now I feel like I’m got an amazing deal on mine. Initially I didn’t. But now after reading that I’m not so sure. However, broker all the way. Their experience is invaluable.

bluey1406

Fisa002 wrote: »

:eek:

Blimey!. Now I feel like I’m got an amazing deal on mine. Initially I didn’t. But now after reading that I’m not so sure. However, broker all the way. Their experience is invaluable.

Yes I know it's a lot which is partly what's worrying me about them. He has however said he feels we could get a 2 year fixed rate at 3.44% which seems pretty good. The fee I can live with however, it's the talk of having to take the insurance that's bothering me..really annoying that brokers can't be recommmended on here, it's such a minefield!

ACG

£999 fee AND taking out insurance!
Yikes.

bluey1406

ACG wrote: »

£999 fee AND taking out insurance!
Yikes.

Would you say we would need a broker who specialises in adverse or should any good whole of market broker be able to help us?

ACG

The rate you have got sounds about right. Most brokers should be able to place this but sometimes it is better to get one who specialises in what you want as they will know those lenders better.

Thrugelmir

Lenders now have a duty of care towards their customers. You could therefore approach them and put forward your idea to downsize etc. This would at least allow you to reset your credit history and start afresh.

To pitch such an idea draw up a plan. This might help convince the lender that your intentions are serious.