Mortgage with 2 defaults which are 2 years old

kc1981

Hi there,

I am looking for some advice/guidance here, I have 2 defaults on my credit file and both are 2 years and 1 month old, these defaults are with TescoBank and Barclays.

We are now looking for a mortgage and am really confused if we will get accepted for a mortgage at 95% LTV. My wife has a clean credit file, I am in full time employment from last 3 years and earn 80k whereas she has recently started work as IT contractor earning 350 pounds a day.

We are looking for a mortgage of 450k on a house of 500k, last year (2017-May) Precise offered us a AIP for 2 year fixed at 5.29% for 420k mortgage. Are there any lenders/brokers out there who would lend to us, at 90% LTV and at a decent rate?

Thanks in advance.

kc1981

Not to mention the broker who was processing our application at Precise was charging ridiculous amounts as fees, here it is -

Lenders fee £1495
Processing and Completion fee £2195
Completion Administration fee £199
Solicitors fees £1909
Valuation fee £630

ACG

Are you using help to buy equity loan? Precise do not do 95% LTV mortgages.

Have the defaults been satisfied? If so, when?

Aside from the brokers fee (which is on the high side), those fees look fairly normal for your kind of case.

Most of the adverse lenders charge £1500, you are looking at a £500k house, so £630 val fee is normal and solicitors fees, assuming that includes the searches is not particularly high.

kc1981

No I'm not looking for help to buy, defaults have not been satisfied, they were for about 10k with TescoBank credit card and 7k with Barclaycard.

We can only deposit 10% and cannot go any higher, we were told last year that Precise would only do 85% LTV for us which is not of much use as we cannot arrange 15% deposit.

Any pointers on lenders who may offer us 90% at somewhat decent APR given our circumstances would be much appreciated... as generally house prices are either stable or sliding down we can afford to wait for a decent APR.

Finally, do you think at any stage (prior to 6 years when defaults come out) could we be accepted by high street banks? Many thanks.

GoingOn30

Well it looks like your choices are:

Buy a 500k house with 90%LTV and pay an extortionate rate and high fees or.......

Buy a cheaper house with 85%LTV

ACG

What are you classing as a decent APR?
With a 10% deposit, I can only think of one lender at around 4-4.5%.

A decent rate will probably be another 12 months, possibly longer.

kc1981

Hi there, with Precise my monthly repayments were working out to be £2441.00 over a term of 29yrs based on borrowing £420,000 (APR 5.59%).

Just having a look around mortgage best buy tables (not that I will get them anyway, but to understand how much I'll be paying over the odds), for similar terms (420k mortgage, 29 year term) monthly payments work out to be about 1450, so if I proceed with Precise I'll be paying about £1,000 over the odds per month which seems to be a rip-off.

So, on this basis, I'd say an APR of around 4% which works out to be around £2000 per month is far more digestible than what I'm being offered by Precise.

ACG

The flip side is what would you be paying in rent. If more than £1,000 a month, then yes you are paying over the odds for a Mortgage but you are saving on rent.

kc1981

Yeah thats true indeed, anyone used Aldermore? Are they any better/worse than Precise? thanks.

Edi81

It!!!8217;s not a rip off. The lender has a higher risk on you - you!!!8217;ve got £17k of defaults that are unsatisfied from 2 years ago.

Settling the defaults would look better but still not easy for you to get a mortgage from any lender.

ACG

I do not think you fit criteria with Aldermore at the minute.