Adverse credit mortgage - planning ahead

MovingForwards

I know we have a few very good brokers on here and would dearly love to pick your brains!

Looking at posts I know you struggle with limited information, so have provided as much as I can. I also am aware than many of you are based in England and not up here!

I am looking to my (our) future and trying to establish where I need to be in order to attain/secure a mortgage based on my history and present. We all know you cannot predict the future and can only work with how lenders are currently assessing lending criteria/affordability.

So, based on the current market if I approached you with the following information could I possibly have a lender, or two, be willing to consider me and what deposit percentage would I be needing to look at.

Default history (all paid off and closed):

07/2013 - £176 - account closed 11/2013
01/2014 - £59 - account closed 01/2014
02/2013 - £544 - account closed 11/2014
08/2014 - £292 - account closed 12/2016
08/2014 - £462 - account closed 11/2017

AR marker since 2015 - started at approx £259 - was settled in full a couple of weeks ago

CCJ - 01/2015 - £4205 - outstanding balance £1467.96 (will be paid off this year)

Debt currently stands at £10,700 (incl outstanding CCJ amount) and reducing each month (DMP), I am also picking the debts off one by one.

Salary £28k (rounded down for ease) and I have been with the company for a year. No bonus and overtime is not guaranteed/regular.

Also, looking at 20 year repayment term, but would be overpaying to bring it down.

I have had a mess with the calculators, comparing present situation with debt (but obviously cant fit in defaults / CCJ) (approx £75k plus deposit) depending on the provider) and no debt (again cant fit in defaults / CCJ) (£125k plus deposit), so am aware of the difference in figures/potential mortgage loan amount.

I am looking to 'spend' about £75 - £80k on a property (including deposit). I am not looking to go to the max just to stay living in the area I am renting as I know if I move a little further away I get more 'value' for money.

I know realistically I am probably having to look at waiting another 2 or 3 years, which obviously gives me a lot more time to save a bigger deposit (currently have approx £6k), but am trying to also make sure I am heading in the right direction with numbers.

So guys, realistically, if I walked into your office today, or called you, and said help me find a mortgage as in January 2019 I want to start making offers..... is it possible to place me with someone? What kind of deposit percentage would I be looking at? What kind of apr would the mortgage be (not expecting it to be favourable!)?

Thank you in advance for taking the time to read and comment

ACG

You are looking to purchase for £80k?
How much is your deposit?

MovingForwards

Deposit is currently 6k, but increasing monthly.

ACG

Tricky one, as I think you are in the middle of 2 options:
1) Clear the payment plan to give you the best possible chance of getting a high street lender or,
2) Keep the money and put it towards getting a 10-15% deposit to look at a more lenient lender.

As it stands I think you will struggle, I would not rule it out but chances are probably slim.

MovingForwards

Sorry, obviously wasnt as clear as I thought I was.

I am trying to establish whether I could get placed with a company and what percent deposit I am needing to aim for

Obviously if the debts are neither here nor there due to the amount I am looking to borrow (£70k) then I can carry on settling the debts bit by bit and plough money into bulking the deposit up.

I cannot quote as I am using my phone!

ACG

15% and you would probably have options at around 3.5% give or take.
If you clear the arrangement to pay, then you may get a high street mortgage, but you may not so you could find it is better to hold the money back and put it towards the 15% deposit.

MovingForwards

ACG you are an absolute darling!

15% will be ok to get together, pay the CCJ off and still bring my debts down.

The apr I was expecting to be 5%, realistically 8% which didnt phase me as I knew it would only be for a few years.

I am currently trying to get the AP markers changed to a default.

Not fussed if it was a high street or alternative lender, I have no preference.

Thank you so much.

Originally I had a 3 year plan of saving, paying debts off, having (most of) the defaults and CCJ drop off. You have given me hope that towards the tailend of 2019 I might be able to find a home

ACG

Speak to a broker with experience in adverse who can take a look over your credit reports. You may find there are options now with a smaller deposit if you are happy to pay rates of 5%.

I do not get much demand for north of the border so do not know the lenders available as well as I do in England.

MovingForwards

I popped into one broker for a chat a few months ago, but there is no way I would give them my custom, maybe they didnt want mine either.

All my mates up here have 'clean' history so havent needed a specialist broker. But I will have a chat with a close friend and see if I can get a contact that way.

I dont know if I am restricted to using a broker up here or if I can use one from my home country?

Obvious main difference up here is the 'offers over' malarky when looking to put an offer in and it's recommended a solicitor works with you to guide on the offer and put it in for you, but getting a solicitor wont be an issue as I have a couple of firms in mind/recommended. But I dont know if that would be difficult for a south of the border broker or if it is just random local banks/building societies hidden away up here are closed to outsiders lol.

I have done the whole monthly payment and higher interest rates which to most would be scary, but the actual monthly payment over the mortgage term is just over half my current rent. Even 10% apr does not concern me due to the relatively small mortgage and it wouldnt be forever.

Finding the right broker who I am comfortable with is a priority rather than the apr.

You really have given me a lot to think about

ACG

You can use a broker in England, Scotland, Wales or NI.

In 5 years, I would say we have done maybe 3-4 mortgages in Scotland. It is an unusual system and you would probably need Scottish conveyancers/solicitors but from a brokers perspective it is more or less the same assuming you are purchasing in and around the offers over figure. I am not sure how it works if you go significantly over the offers over.

Anyway, friday night im off for a pint.