Bad Credit - Precise Mortgage.

Toodlepips

Hi guys, please be kind, I am hoping someone on here can help. 
Recently our landlord of 5 years has decided to put the house up for sale, so are looking to buy a house much sooner than we anticipated. 
Unfortunately this means we haven't had much chance to tidy our credit files up as much as we would have liked to. 
So far we have applied with vida - declined based on credit report and have been rejected a dip with Aldermore for the same reasons. 
Our broker has not put an application in with Precise but said she feels it may be declined on the same basis and then we are out of options. 
We have reserved a plot using the HTB scheme at £197,500 30% deposit including the 20% equity loan. 
Total cost of mortgage = £138,250 
Now the tricky bit! My credit is horrendous due to a badly timed self employment decision that meant no money coming in at the beginning of 2018. 
1 CCJ for £783 filed Dec 18 
5 Defaults - One settled (although not yet showing as such) The rest with payment plans in place and will be paid come summer all from 2018
1 for 355
1 for 1000
1 progressed to a ccj for 783
1 112- that’s settled 
1 for 325 
2 of the defaults are over 2 years old and the others are from late 2018. 
We earn a joint income of 40k currently pay rent of £575, have no nursery fees, loans or car payments to make. 
We are both now in full time employed work and have 2 dependants. 
Our broker is one that barretts recommended and has gradually made us feel less and less confident.
Affordability we are fine... its just the credit managing that we seem to be failing on. 
 We have been gifted the deposit (because of the quickness of it all) which probably doesnt help our situation. 
Can anyone help or advise anything different to what we are doing? we have been gifted the deposit (because of the quickness of it all) 
are we better off using some of that deposit to pay the smaller defaults off? 
we are quite prepared to pay a high interest rate if its the difference between us getting the house or not. 
Thanks if you managed to read all that!

[Deleted User]

One of the issues I run in to on cases like this is when the underwriter challenges that the mortgage payment is going to be higher than the current rent but you haven't been paying off debts.   Aldermore and Precise both declined one recently for that reason .  

Precise are usually ok for sticking to an AIP decision if everything has been declared.   You are within their policy of 5 defaults and max 3 CCJ's so if you pass an AIP then there isnt any reason to be negative. 

How are your bank statements?  Overdraft useage? Gambling? Going over limits on anything?

Toodlepips

Thanks for easing my easily worried mind a little! 
The AIP has been agreed and application going in tonight. 
Bank statements are the usual takeaways, food shopping ect. no gabling other than an odd hopeful lottery ticket here and there! I don't have an overdraft, other half sometimes goes into his but that is an authorised one that he pays a monthly sub for. 
Probably an obvious answer but would it make any difference if I settled the debts sooner rather than later? 

ACG

Find a different broker. 
From your other posts, I do not rate whoever you have. Thats not asking you to message me btw, I do not do HTB EL mortgages. There are times with bad credit where you can chase the best rates, but there are other times (yours included) where I think you need to just go to the lender most likely to accept. I think your broker is trying to chase the rate at the minute.

MovingForwards

@Toodlepips follow the information from the brokers.

You should be planning to get any mortgage for now, then remortgage it when your credit history allows.

I know it's not nice seeing low interest rates being banded around, but one day it will be your turn. You will be in your own home, no LL threatening to sell, put your rent up, saying you can't decorate, waiting for repairs to be done.

Short-term pain for long-term gain.

Toodlepips

Thanks for the comments guys.
Honestly, we don’t mind the interest rate aslong as we have our home. If precise decline us am I right in thinking we have exhausted our help to buy options with bad credit? Vida, Aldermore and precise. I didn’t think there were any other go tos? My broker basically said it was the end of the road if precise decline 😫

amnblog

Hi Toodlepips
We do H2B with Adverse regularly, and like ACG, don't rate your current Broker from what you have said.

Although you are right on the limit of what Precise will accept, it appears you have passed decision in principle so that is a good sign. We now hope that all other potential 'curve balls' have been accounted for by the Broker.

Where you are is not at the end of the line with Precise, you are very close to it.

Can we assume that you have already received your Authority to Proceed from the H2B agency for the equity loan? If so, one tip would be that, someone needs to ensure that the affordability calculation has been checked using the Precise revert rate.

We wish you well.

amnblog

By the way, the Precise revert rate is most likely 5.69% from what you have said. The standard H2B calculation is based on 4.80% so the 5.69% figure drops the affordability calculation as a result.

Toodlepips

Hi amnblog, thank you so much for your input. If this comes back as a decline we will most definitely be finding an alternative broker for options. We did approach one company (quite well known and one of the main ones) and they said they couldn’t help me. The issue is finding someone like yourselves who is familiar with the htb part aswell as adverse credit!  

Yes the equity loan is in place, it really is just a case of a mortgage offer needed. The deposit is there, the affordability to pay the monthly payments, the house is built and ready for us. From experience if you have used them, how reliable are the precise dips? 

Toodlepips

Just out of interest and not sure how to word this to make sense but if the ccj was once a default...do they count that as a default and ccj or just ccj? 
So say 2 defaults and a ccj or would I have to count the ccj to be 3 defaults and a ccj? 

amnblog

Both default and CCJ are counted if you move from one to the other. Precise Dips are reliable - that does not mean there are not other issues with the file.