Mortgage with bad credit?

Halfwaythere

I am a few months out of a debt management plan. I have 2 defaulted accounts from 2018 that I still pay a small amount to a month, they total around 13k. My Experian credit rating is good and my partners is. We earn 50k between us. At the moment we have 12k for a deposit and hope to buy a house next summer with 20k deposit for a property around 150k. Is this possible or do I need to carry on renting and pay the debt off first? Thanks 

ACG

You might need to get to the £22,500 mark (15%) but  should be possible. 

Halfwaythere

Thank you. Will the 13k defaulted accounts matter? 

ACG

It shouldnt be a deal breaker.
Just to say that, I am working on the assumption that the world doesnt go to pot (more so than it already is). The adverse lenders do want to get to 80 and 85% LTV, they are not quite there yet in the main but they want to be by the end of Q1 next year. 

As things stand, I reckon you would need 20%, so we are kind of hoping things get better rather than worse. 

Halfwaythere

Thanks so much that’s really helpful and I hope you are right and it doesn’t get any worse! How come house prices are higher than ever when we are in a worse situation ? 

MovingForwards

Halfwaythere said:

Thanks so much that’s really helpful and I hope you are right and it doesn’t get any worse! How come house prices are higher than ever when we are in a worse situation ? 

Stamp duty holiday.

I put my trust in ACG and he placed me with the right lender for my credit history, he's helped quite a few members get their own home.

Thrugelmir

Why weren't the other 2 accounts included in the DMP? 

ACG

Halfwaythere said:

Thanks so much that’s really helpful and I hope you are right and it doesn’t get any worse! How come house prices are higher than ever when we are in a worse situation ? 

Because demand is insane. 
We are about 35-40% up on last years submitted business and we still have 2 months to go. 

Stamp duty holiday is helping,
The HTB scheme is changing next year, 
You have had people who during lockdown did not like their homes and so want to move somewhere bigger/smaller/closer to parents or even moving out from parents,
Redundancies making people want to downsize? 

There is a lot going on at the moment. The problem is, if a crash happens that will mean lenders tighten up and need bigger deposit and/or charge more. I suppose we just need it to level off - every broker I know is exhausted. But nobody knows what the future holds so its just a case of making hay whilst we can and seeing what happens next year. 

Halfwaythere

Thrugelmir said:

Why weren't the other 2 accounts included in the DMP? 

They were but I went self managed and paid off all the accounts with ap markers. I am paying the two defaulted accounts the minimum in hope of getting a good settlement offer in the future