Mortgage arrears, need specific advice

carol1981

Hi all

Am a regular long term forum user but have made a throwaway account for this as don't want to be identified.

Me and my husband are going through divorce, hugely hostile and we do not speak at all. No kids, thankfully.

We own a house which has been up for sale and now has had an offer on, sale hopefully looking to complete next month or December. We both live elsewhere now and the house has been empty for a while.

Since seperation we have been paying the mortgage payments in equal shares as agreed through solicitors and it's been kept up to date but now my husband is not paying all of his share and the mortgage is in small arrears, and we have had warning letters sent out. The mortgage payments are not going to be paid in full from now on, I can pay half of it but he cannot make any payment towards it at all and that will not change (the reasons for that are an entire different thread on its own).

I've told the mortgage company the situation which they understand,but also we are both liable for the mortgage which I understand. I've written to all the credit agencies explaining situation in full, which might not help but my soliciotr told me to do it anyway.

I know these questions will be asked so I'm just going to say up front - All avenues have been explored of trying to find money to make up the deficit but it is not possible. There is no money to be borrowed, no payment holidays available (have checked), no payment lowering/mortgage extension (have checked). I absolutely cannot pay what he is not, there is simply no money to do do.

So the situation in brief is:
- joint mortgage is in small arrears
- full payment cannot be paid for the foreseeable, but half of usual monthly payment can be paid
- house sale is likely to complete within two month at max (aware this is not a guarantee)

So I know this is going to affect our credit files, and it is going to happen. My question is - is the sale goes through in next two months, some payment is made towards mortgage but not in full - what markers will go on our credit files and how long will they take to repair? As soon as divorce is finalised I'll be taking steps to financially diassociate myself from husband.

WIll it be late payment markers? Defaults? We have credit cards which are up to date with payments (well mine are certainly) and will be in the future so will that help to repair credit files? I have asked mortgage company this question but all they have said is that it will affect my credit rating andd have asked me to pay up, which I cannot do.

Help, please?

[Deleted User]

Likely Late Payment markers or AP (Arrangement to Pay) markers will be added to your files.

These will stay on there for 6 years following the closure of the mortgage account.

They will only default the account if the payment completely stops

carol1981

Thanks for your reply Garry. Do you know how those late payment or payment arrangement markers would affect future ability to get credit ie while they're still on there? I don't intend on getting another mortgage or any other forms of credit for a long while any way, just will be maintaining the credit cards I've got.

Would I still be able to get another credit card for example? But maybe with lower limit and higher interest? Just based on the fact of these mortgage markers? I appreciate that might not be easy to answer!

Willing2Learn

carol1981 wrote: »

Would I still be able to get another credit card for example? But maybe with lower limit and higher interest? Just based on the fact of these mortgage markers? I appreciate that might not be easy to answer!

Yes, yes and yes lol This is because the late payment or 'AP' markers indicate to any potential lender, that you are currently struggling to manage your financial commitments.

carol1981

Thanks for the reply! Good to know that I wouldn’t be cut off from all forms of credit.

What about my existing credit cards? Would my lenders cut my limits or anything?

Sorry for all the questions but I’ve never had any blemish on my credit and I’m not sure ho it all works. Grateful for any comments!

[Deleted User]

No they won’t, unless they regularly review your files if they want to check how you’re managing your money

Thrugelmir

Add a notice of correction to your account. Might not resolve all potential issues however at least provides an explanation.

Dobbibill

Have you explored changing the mortgage to interest only temporarily OP. This would reduce the payments possibly enabling you to make full contractual payments, albeit interest only payments.
This should prevent any markers on your credit file.

This is on the assumption that you are not on an interest only mortgage already.

carol1981

For some reason I can’t multi quote on my phone, sorry!

In my letters to the credit agencies I asked for it to be a notice of correction put on there.

Sadly, the option of going interest only isn’t available either, it’s a capital repayment mortgage currently. But cannot switch it. Thanks for the thought though!

sourcrates

Just to add, if your keeping up other credit payments, then your file will reflect this as a positive, AP markers are not the end of the world, they will maybe just restrict the type of credit you can get, and interest rates will most likely be higher as a result.