Partner looking at debt management plans

[Deleted User]

Hey people!

Myself and partner are looking at purchasing a house soon (first time buyers).

the plan was for myself to apply for a lone mortgage as my overall credit, and financial position is in a better way than hers.

We’ve made a decision to hold off a few months and to apply for a joint mortgage application, my question is, she’s been looking at DMP’s to clear some of her existing debt (some defaults, 3 to be exact), and a total combined debt of £3872.82pence.

is it worth her going into a DMP? Or will it massively affect our mortgage application in future? 

Any help/advice, or past experience from anyone would be great.

thankyou.

Willing2Learn

Why not get your OH to join the forum?  They could then complete an SOA and post it up in the Debt-Free Wannabe board.

And you can still get a mortgage while being on a DMP.  You would just need a good and experienced mortgage broker.

sourcrates

What worries me from your post is this, if they are having problems repaying 3k of debt, how on earth are they going to manage mortgage repayments ?

[Deleted User]

sourcrates said:

What worries me from your post is this, if they are having problems repaying 3k of debt, how on earth are they going to manage mortgage repayments ?

It’s not that she’s struggling to pay, it would just be easier to condense them into one payment, and easier to manage.

[Deleted User]

Willing2Learn said:

Why not get your OH to join the forum?  They could then complete an SOA and post it up in the Debt-Free Wannabe board.

And you can still get a mortgage while being on a DMP.  You would just need a good and experienced mortgage broker.

Awesome, there’s light at the end of the tunnel then, I’ll get her to do an SOA, and post it here, I know I had a huge help from that forum when I was struggling with debt 2 years back.

 Thanks.

Grumpy_chap

You are clearly committed to shared lives together and that is going to mean an element of shared finances and shared impacts on each other's credit ratings (purely by sharing address that will happen).

You state that you have better finances and credit rating than she does, and there will always be one with a better position than the other in any relationship.  Rather than OH entering into a DMP, is it possible for you to clear her debts (at £4k that is not a massive number) so that her credit rating is as strong as it possibly can be when you come to apply for the joint mortgage in a few months' time?  Her past defaults are fact and can't be changed, but if she shows a perfect pattern of behaviour for a few months, that can only help.

This does not need to be you just giving her the £4k, but you could agree to help her now, in return for her paying you back as an unofficial friend / family member loan.  

Willing2Learn

If you are going to consider a loan to her, then before you do any of that, your partner should submit a CCA request for each applicable account first.  It may turn out that they are unable to provide your partner with the correct paperwork, which would mean your partner would not be obliged to repay another penny toward it.

Debts – why, how & when to ask for the CCA agreement

eskbanker

Mjfender26 said:

sourcrates said:

What worries me from your post is this, if they are having problems repaying 3k of debt, how on earth are they going to manage mortgage repayments ?

It’s not that she’s struggling to pay, it would just be easier to condense them into one payment, and easier to manage.

Has she fallen for the myth of debt consolidation, or would this be a meaningful refinancing of debt onto significantly better terms (either rate or term)?

[Deleted User]

eskbanker said:

Mjfender26 said:

sourcrates said:

What worries me from your post is this, if they are having problems repaying 3k of debt, how on earth are they going to manage mortgage repayments ?

It’s not that she’s struggling to pay, it would just be easier to condense them into one payment, and easier to manage.

Has she fallen for the myth of debt consolidation, or would this be a meaningful refinancing of debt onto significantly better terms (either rate or term)?

I think she mainly wants to get all her debt in one place.

Willing2Learn said:

If you are going to consider a loan to her, then before you do any of that, your partner should submit a CCA request for each applicable account first.  It may turn out that they are unable to provide your partner with the correct paperwork, which would mean your partner would not be obliged to repay another penny toward it.

Debts – why, how & when to ask for the CCA agreement

Just tried reading through that, many abbreviations and other big words 
, in short, if they can’t provide a CCA, she doesn’t have to pay the debt? Meaning the mortgage companies would look at her in a better light? 

Willing2Learn

Correct.  But it is only relevant for the right type of account.  A cheque or postal order for £1 needs to be included for each request.

Use the letter template linked below:
https://www.nationaldebtline.org/EW/sampleletters/Pages/Information-about-your-agreement-under-the-Consumer-Credit-Act-(sole-name).aspx

[Deleted User]

Willing2Learn said:

Correct.  But it is only relevant for the right type of account.  A cheque or postal order for £1 needs to be included for each request.

Use the letter template linked below:
https://www.nationaldebtline.org/EW/sampleletters/Pages/Information-about-your-agreement-under-the-Consumer-Credit-Act-(sole-name).aspx

Great, basing off information I’ve helped her fill in on this DMP (not yet committed), the defaults are from old Mobile phone contract and pay day loans.

would those accounts fall into those types ?