Bad Credit - need Mortgage - HELP

kylieM_2

Hi all

I am hoping someone can help me out. My partner and I have bad credit ratings (defaults) we have never been bankcrupt, but we are finding it really hard to be exepted for a 100% mortgage. We have tried, northern rock, royal bank of scotland and our own bank Natwest, where we have an excellent record with. Does anyone know of a company who are quite relaxed with credit rating, but don't charge the earth

Thanks

Kylie

herbiesjp

How many defaults?
What amount is each default for?

How long ago were these defaults registered?

In the current climate, anything other than a 100% clean credit history and you will not be getting a 100% mortgage

kylieM_2

I have one default that is paid up 3 months ago, Same with my partner.

Is it quite easy to get a 95% mortgage?

herbiesjp

Good to hear that they are both paid up

However, when were they first regidtered on your credit file, as that is an important date also for mortgage lenders, a long with the actual default amount

At 95% it could still be just as hard depending on your answers - however there are some lenders that are more sympathetic to credit "blips" as long as there is a good explanation

sarkin

How much do you earn, what is the value of the property and is it possible to raise 5 % deposit for you mortgage.

kylieM_2

Thanks for your responses.

We both earn £18,000 each, Because I live in south east probally want to buy a proberty at least £160,000.

5% would be quite hard to achieve, but I might not have any choice.

I don't know if it would make any difference, but I would be willing to show my credit report to any Mortgage company.

herbiesjp

kylieM wrote: »

I don't know if it would make any difference, but I would be willing to show my credit report to any Mortgage company.

Not really.

Any mortgage company will see your credit report anyway when they carry out a credit search.

It would be useful to show to a broker, so they have all your information and will be able to find the mortgage that best fits what is on your credit report

reformed_84

Hi,
Firstly, sorry for the long post, I wanted to give alll the information I could to help get the best advise.
I am new to these forums, but I have been using this site for a while now! I need some advise.
A couple of years ago I got into a bad situation with money, or should i say CREDIT! No excuses, I was young and greedy! Anyway. Everything came to a head at the start of 2006. I ended up signing up with a credit company [Gregory Pennington] and they took on my 'payments' to my lenders. That wasnt goin very well and I was paying them to do this for me- I felt I was in a position to really move things myself (and I have!) However.. I have the below marked on my credit file:

1 Default- 28th Feb 2006- Default amount- £8,247- satisfied on Friday Last week!
1 Default- 3rd Nov 2005- Default amount- £1223- satisfied on the 30th August 2007
A big black number 6- (missed payments/ 6 months in arrears)- Jan 2006- amount £903- satisfied in April 2007

Bad I know! :mad: Im really worred that my foolish past is going to haunt me in the next year or so when I look at getting a mortgage. Is this gonna be a really big struggle for me? What can I do to improve my credit rating over the next year? Im earning £27000 a year and my partner is currently on £17000.
Im spending the next year saving up a nice fat deposit but am I wasting my time?

Help!! -
A worried reformed fool!

herbiesjp

Welcome to the board


The bigger the deposit, the more options you will have available to you.
A lot of lenders will "ignore defaults if they have been registered over 2 years ago - being satisfied also helps a great deal

Were the 2 defaults and 1 6 months arrears, 3 different loans or credit cards?

Time is a great healer, so the more tiem passes, the less impact these issues will affect your credit score.

Buying on cards, and clearing each month will help - even if it's £100 each month. It shows you have got a commitmenmt and that you are able to clear in full each - please don't over stretch on this and start raising debts, as this will impact on the mortgages amounts available. So spend £100 then clear.


What purchase prices were you hoping for? What deposit did you have in mind?

reformed_84

Thanks for that herbiesjp- in answer to your questions:

The defaults were a loan and a credit card and the 6 late payments was for another credit card.

I was thinking of a deposit at least around 7k and a house price about 100k maybe slightly more.

Ive applied for a high interest card as I thought that would help. And dont worry- Ive learnt my lesson.. only use it for small amount sand make sure its paid off straight away!- never going to that HELL again! haha!

Reformed_84

luckyfool

reformed_84 wrote: »

Thanks for that herbiesjp- in answer to your questions:

The defaults were a loan and a credit card and the 6 late payments was for another credit card.

I was thinking of a deposit at least around 7k and a house price about 100k maybe slightly more.

Ive applied for a high interest card as I thought that would help. And dont worry- Ive learnt my lesson.. only use it for small amount sand make sure its paid off straight away!- never going to that HELL again! haha!

Reformed_84

Based on your answers, if you maintain any new credit well, and are applying after all defaults show as having been satisfied for at least 12 months then I would put your chances at getting 95% at about evens. There are a few credit repair lenders out there still offering 95%, but virtually all will operate a credit score at 95% so factors other than just defaults/ccjs will come into it. An important move for you if you are not already, is to make sure you are registered on the voters roll. This will improve your credit score.

If you can try to get into the position that you can put down 10%, i.e. 10k on a 100k property (bear in mind other costs such as a solicitor (c. £900) and a valuation (c. £200+) then I would be very confident of being able to get some kind of mortgage based on whats available just now. Obviously I can't say what the market will be like when the time comes round for you, it could be easier or tougher in terms of what lenders will offer.

The bottom line for how you can maximise your chances would be the same though, save for as big a deposit as possible, get on voters roll if not already, and get a copy of your experian and equifax reports and ensure than everything is correct and up to date on them,

hope this helps,

Luckyfool