Getting a mortgage with defaults

Mayweather96

Hi everyone 
So in late 2016, I struggled with a little bit of debt and believe I was wrongly advised into a Debt Management Plan, which obviously incurred Defaults. 
As I'm 24 now I will soon be wanting to look at a mortgage and move out with my girlfriend. I paid for Experian Credit Expert and my file is showing 1 Default (Overdraft £46) which was satisfied October 2018, a Credit Card which has a note to say a payment plan was in place, and a store card which had the same note. I'm not sure why some are defaulted and others just a note but that is the situation. All has been settled for approx 2 years. My credit score is 711.
Would I struggled to get a joint mortgage with a high street and good rate? Does LTV matter? Amount of defaults? Date of defaults?
It would just be embarrassing to be rejected on my behalf considering her report is perfect. 
Thank you

upthegarry

Mayweather96 said:

Hi everyone 
So in late 2016, I struggled with a little bit of debt and believe I was wrongly advised into a Debt Management Plan, which obviously incurred Defaults. 
As I'm 24 now I will soon be wanting to look at a mortgage and move out with my girlfriend. I paid for Experian Credit Expert and my file is showing 1 Default (Overdraft £46) which was satisfied October 2018, a Credit Card which has a note to say a payment plan was in place, and a store card which had the same note. I'm not sure why some are defaulted and others just a note but that is the situation. All has been settled for approx 2 years. My credit score is 711.
Would I struggled to get a joint mortgage with a high street and good rate? Does LTV matter? Amount of defaults? Date of defaults?
It would just be embarrassing to be rejected on my behalf considering her report is perfect. 
Thank you

I have just got a mortgage approved with a high street lender with 2 defaults on my file - significantly higher than your defaulted amount

Mayweather96

Wow nice.. did you use a broker

upthegarry

Mayweather96 said:

Wow nice.. did you use a broker

i did yes. We are FTB using HTB - whether that makes a difference i don't know. The defaults were nearly 6 years old, again i don't know if that helps as they were quite old and not far off dropping from the credit file anyway

Fighter1986

1. Never pay to see your credit file. You can obtain your statutory reports free from Equifax, Experian, and Trans Union
2. Pay no notice of your score. This isn't seen by lenders. They search the contents of your actual credit file and look at the data you supply on your application form. The score is a number generated for your amusement only, it's a marketing technique to get you hooked on coming back to see if it's improved, which gives them an opportunity to sell you credit products you don't need. 
3. If you have notices of correction with any of your three credit files (Equifax, Experian, and TransUnion), contact the respective credit reference agency to have them removed. They do more harm than good, they block automated decisions. It's better to pass automated decisions without a notice of correction than have an underwriter manually scrutinize your credit history. 
4. If your debt is now settled, what matters is the dates on which you originally defaulted. If the defaults are over three years old (from default date, not settled date) they shouldn't pose a huge problem.

As long as you have no outstanding debt, and the recent 2-3 years of credit management had been flawless - and I mean not one missed payment - you'll have a wide selection of lenders available to you. 

Speak to an all of market broker like London & Country to match you with a suitable lender for your circumstances once you've cleared up all the above

As for maximum lend, for someone with no debt and no adverse credit in the last 36 months, you'll usually be offered 4.5-4.75x your basic annual salary, and a max LTV of 85-90%. 

As for max LTV today, it's likely to be inhibited by the highly volatile situation right now. Sit on your plans for six months until the market stabilizes and lenders relax a little or you may find yourself limited to 70% LTV. 

Mayweather96

Fighter1986 said:

1. Never pay to see your credit file. You can obtain your statutory reports free from Equifax, Experian, and Trans Union
2. Pay no notice of your score. This isn't seen by lenders. They search the contents of your actual credit file and look at the data you supply on your application form. The score is a number generated for your amusement only, it's a marketing technique to get you hooked on coming back to see if it's improved, which gives them an opportunity to sell you credit products you don't need. 
3. If you have notices of correction with any of your three credit files (Equifax, Experian, and TransUnion), contact the respective credit reference agency to have them removed. They do more harm than good, they block automated decisions. It's better to pass automated decisions without a notice of correction than have an underwriter manually scrutinize your credit history. 
4. If your debt is now settled, what matters is the dates on which you originally defaulted. If the defaults are over three years old (from default date, not settled date) they shouldn't pose a huge problem.

As long as you have no outstanding debt, and the recent 2-3 years of credit management had been flawless - and I mean not one missed payment - you'll have a wide selection of lenders available to you. 

Speak to an all of market broker like London & Country to match you with a suitable lender for your circumstances once you've cleared up all the above

As for maximum lend, for someone with no debt and no adverse credit in the last 36 months, you'll usually be offered 4.5-4.75x your basic annual salary, and a max LTV of 85-90%. 

As for max LTV today, it's likely to be inhibited by the highly volatile situation right now. Sit on your plans for six months until the market stabilizes and lenders relax a little or you may find yourself limited to 70% LTV. 

Thanks for the detailed reply, mcuh appreciated. 
Would the notes on my accounts ("The lender has reported that the account has been included in a debt-management programme (for example, one organised by a citizens advice bureau, National Debtline or the Consumer Credit Counselling Service") count as a notice of correction? Could I have this removed?

Kiwistrawb1990

When did you complete the DMP? The defaults won't be an issue but the DMP will. My lender has declined our application based on thinking I was in a DMP (I wasn't and never have been, and now have the confirmation of this so are appealing) so I know that a DMP will be a big problem.

You want an independent broker, not a large one as mentioned above, one specialising in adverse credit x

Mayweather96

Kiwistrawb1990 said:

When did you complete the DMP? The defaults won't be an issue but the DMP will. My lender has declined our application based on thinking I was in a DMP (I wasn't and never have been, and now have the confirmation of this so are appealing) so I know that a DMP will be a big problem.

You want an independent broker, not a large one as mentioned above, one specialising in adverse credit x

Thanks for your reply. 
Even if the DMP has been settled for 2/3 years?

Kiwistrawb1990

Mayweather96 said:

Kiwistrawb1990 said:

When did you complete the DMP? The defaults won't be an issue but the DMP will. My lender has declined our application based on thinking I was in a DMP (I wasn't and never have been, and now have the confirmation of this so are appealing) so I know that a DMP will be a big problem.

You want an independent broker, not a large one as mentioned above, one specialising in adverse credit x

Thanks for your reply. 
Even if the DMP has been settled for 2/3 years?

You shouldn't have many issues if it's been settled that long. Definitely pick a good broker there are a few on here who specialise in adverse credit x

MovingForwards

A few defaults / late payments are one thing, a DMP is the difference between a lender saying yes or no.

You would need to go through all of the criteria for the different lenders and hope you have picked the right one.

With adverse history still on my credit file, it's not one I would want to be trying to do on my own. There is a good adverse broker who posts on this forum, he got me my mortgage and I've been happily sitting in my home for about 6 weeks now.

NatalieAGC

Well personal preference on paying for credit files. I pay for mine and have done for the last 2-3 years. It’s small token each month and gives clear view of your personal financial data which is very important!  You can access free but they only give you monthly view and will have to wait another 30 days for new update. . So not accurate real time data. 

I have a settled £800 default from 2015 and as yet not got mortgage in place... may be able update in 2-3 weeks but as yet still looking with Broker.