Re-Mortgage with bad credit?

themachine_2

Hi all,

I would really appreciate anyone's advice on this matter. Myself and my OH are looking to buy a property in the near future, however i have a poor credit history due to several late payments on CC's and car loan. My total unsecured debt is approx £17000 with an annual income of £20000. My OH has very good history and unsecured debt of around £4000 (income £15500).
We had mortgage with NR for 2 years , however we sold our house and bought a flat with the profit. We have been living with OH's parents for 6 months while we renovated flat which is now worth £65000 (bought for £24000).
we are looking to buy a house and need a mortgage but i am worried we will be refused due to my credit history. We would be debt free with around £40000 deposit for house (looking around £140000) when sale of flat is completed. Any opinions on this would be of great help.

Thanks

herbiesjp

YOu will be able to find lenders, you just need to try and find the one that does not penalise you too much for your credit blips

themachine_2

Thanks,
Do you expect we will have to pay a slightly higher rate than most high street lenders?

herbiesjp

It really does depend on your credit file and what shows up on the credit file.

If you have a lot of missed payments and they are on a regular basis then yes it will affect the deals available.

If there are the odd few, spread over a few years, then you probably can get high street rates

Difficult to more precise without knowing/seeing the exact details of a credit file

sarkin

Most of the big players in the bad credit market have withdrawn back down to 75% loan to value. If you can at least show 1 year of clean credit this will help with rates. You do need to speak to a mortgage broker as you may not find a high street lender willing to lend.

luckyfool

How easy it is for you to source a high street mortgage will to a large extent depend on whether you have a deposit, and how much it is. If you have 10% or more then I would be pretty confident with a few Prime lenders (Chelsea BS, Accord Mortgages (broker arm of Yorkshire Building Society), however if it came down to having to go for a Credit Repair/Sub Prime product then 90% is reliably available as long as you have no defaults in the last year, or ccjs in the last 2 years, or arrears on any mortgage or rent in the last 12 months. 95% may still be available from some specialist lenders, however the only ones still in that market now include a credit score as an element of their decision so alot of factors would come into play (such as if you are on the voters roll etc.).

themachine_2

Thank you for your advice,

Speaking with an advisor would be of great benefit. The LTV would be in the region of 70% and we are both on the voters roll and have been in continuous, secure employment for over 6 years. We previously had a mortgage for 2 years with Northern Rock and made the monthly payments with no problems. The main problem has been my 2 credit card repayment dates being towards the end of each month and i sometimes have to wait until the last day of the month to make the payments as that's when i get paid. Does a late payment of a 3 or 4 days get recorded automatically with the credit file companies?

herbiesjp

Could you not set up a Direct debit to the make minimum payment, and then pay any extra when your salary hits your account? That way you avoid the missed payment scenario

themachine_2

Yes i have just arranged this with one of them yesterday but they couldn't confirm what date it would be taken on (i thought that was strange!). What would really help would be to try and change the payment date to the last working day of each month as that's when i get paid. Do you know if they can change the payment date?