Help to Buy Mortgage - Adverse Credit

Evolution86

Hi All,

My partner and I are looking to purchase our first property using the help to buy scheme and we are looking for some advice due to poor credit history.

I have had defaults and payday loans all of which were settled in 2014 although some are showing on various credit reports as 'last updated in 2017'.
I also had some small cash advances on CC just over 12 months ago.

My current debt is £3K on a £4K credit card which will be paid off by the end of the year.
My partner has no debt but also no credit history due to not requiring any credit over the last 6 years.

We are looking at properties in the region of £210,000- £230,000 and will have at least 5% deposit by the time we will be applying for Mortgage.

My Salary is £31K
Partners is £26K

Student loan, £70/month phone & £270/month car finance the other fixed outgoings.

Is the amount we are potentially looking to borrow do able?
Are we best going to a mortgage broker due to my adverse credit history? If so, any suggestions?
Should I wait until the defaults are fully off my credit file before approaching brokers?

Thanks in advance

haras_nosirrah

Hi
Credit report wise there are some lenders who do adverse along with the help to buy scheme

As long as the defaults are settled for 12 months there will be options. Settled over 3 yrs ago will bring up high street options

Looking at the help to buy calculator that looks fine for the 230k so I don't see you having an issue

As with all things the devil is in the detail but based on the above I would be confident in getting you sorted.

Hungary971

I had old ccjs and we used precise for our htb

MortgageMamma

You don't always have to go to Precise for adverse help to buy applications, their rates are horrendous and for us brokers they are the lender of last resort.

To the OP. There are plenty of smallish building societies and lenders you will not have heard of who will be happy to look at this for you. Will you be reducing your debt to zero before your mortgage application? Have you found a property/development you are interested in as yet?

Evolution86

Thanks for the responses so far.

The credit card debt will be cleared but the student loan and car finance will be ongoing.

Do these pose any issues?

Yes, there is a development we are interested in. Not wanting to get our Hope's up just yet though due to aforementioned doubts.

RelievedSheff

Go to a mortgage broker. They will be able to advise you on your best options and get you a DIP to show to the developers.

MortgageMamma

Evolution86 wrote: »

Thanks for the responses so far.

The credit card debt will be cleared but the student loan and car finance will be ongoing.

Do these pose any issues?

Yes, there is a development we are interested in. Not wanting to get our Hope's up just yet though due to aforementioned doubts.

The only way you can tell if its going to be an issue is if you have to actual purchase price of the property you wish to buy, and then a broker can run a full affordability check for you to see if you can obtain the lending amount you require.

amnblog

Evolution86 wrote: »

Hi All,

My partner and I are looking to purchase our first property using the help to buy scheme and we are looking for some advice due to poor credit history.

I have had defaults and payday loans all of which were settled in 2014 although some are showing on various credit reports as 'last updated in 2017'.
I also had some small cash advances on CC just over 12 months ago.

My current debt is £3K on a £4K credit card which will be paid off by the end of the year.
My partner has no debt but also no credit history due to not requiring any credit over the last 6 years.

We are looking at properties in the region of £210,000- £230,000 and will have at least 5% deposit by the time we will be applying for Mortgage.

My Salary is £31K
Partners is £26K

Student loan, £70/month phone & £270/month car finance the other fixed outgoings.

Evolution86 wrote: »

Is the amount we are potentially looking to borrow do able?

It sounds it, yes

Evolution86 wrote: »

Are we best going to a mortgage broker due to my adverse credit history? If so, any suggestions?

Definitely, a broker will sort this

Evolution86 wrote: »

Should I wait until the defaults are fully off my credit file before approaching brokers?

Not necessary

Thanks in advance

Good luck with it