Mortgage Application with Small Old Default

Fletchasketch

Hello,

Am currently in the process for applying for a mortgage and have had an application with Santander declined (they do a soft-search for an AIP). When I called they said it was for a small default from Jan '16.

I was aware of this default- it's £89 for a Gas bill I definitely paid (by cheque, so cannot prove) and BG have previously refused to remove it. They did agree to wipe the debt, however, so it is settled.

I (perhaps naively!) never realised such a small default would impact a mortgage application- so would just like some guidance on how bad a small old default really is. The rest of my credit record is spotless and I have a £120'000 deposit/ 70% LTV if this helps. I will of course consult my broker, but he's on holiday this week and this is keeping me awake at night!

Thanks a lot.

sal_III

Did your broker knew about the default when applying for DIP with Santander?

Fletchasketch

Nope, I didn't think such a small amount would have an impact. I created the AIP online and it's a soft search so shouldn't impact my credit record.

kingstreet

The default is over two years old and there are lenders who will consider such cases.

On the other side of the coin, there are lenders who won't lend as it isn't three years old and others who won't lend at all.

Soft search or not, I wouldn't have put this to Santander.

Does it appear on all three versions of your credit file, or just one or two?

Fletchasketch

It's not on Noddle, but it is on Experian. I don't know about Equifax.

Fletchasketch

Bumping in case anyone else has any words of wisdom. Would it make a big difference to wait until the default is three years old?