Getting a mortgage with defaults

Barnesey27

Hi,
My partner and I are ready to buy our first property together, however he has a bad credit file. He has had 2 defaults on credit cards, one was settled in January this year, the other was settled in July this year. We managed to get a mortgage in principle from a company called precise mortgages that lend to people with bad credit, however the mortgage payments are astronomical (£400 more than if we went with a high street lender). I was wondering if anyone had any advice on the amount of time we would have to wait before we would be able to get a more competitive rate mortgage? We’d like to move ASAP and have the money to do so, just worried about being stuck with huge mortgage payments for 2 years.
Thanks!

ACG

When were the defaults registered?

spadoosh

Sorry misread and thought the defaults happened this year and not where settled this year.

Barnesey27

They were registered end of 2017

butterflybook

registered the end of 2017 i would imagine this will limit your options - How much were they for? It may be that depending on the amount the defaults were registered for that the likes of precise may be your only option at this point. High street lenders will likely want a longer period of time to have passed

Barnesey27

One was for car finance so was over £17000, the other was a credit card for about £2000. Would our options be better say in a years time?

ACG

Still very recent. You are looking at another year before you start to look at semi normal rates.

I suppose you need to weigh up against what you are paying in rent. 2 year deal and at the end of it you are looking at relatively normal (if not normal rates) otherwise you wait 12 months an get something around the 3% kind of rate for 2 years.

foxy-stoat

If house prices in your area are increasing by less than £5,000 a year then wait it out - if on the other hand they are rising steadily then paying the extra to get on the ladder now may be a good call, you can always move lenders in 2 years if all goes well.

You will likely get the property you want cheaper now as all I hear is, Brexit this and nothing really sells near Christmas blah blah blah.....