Mortgage with bad credit help?

TanJ23

Hi, this is my first post and mortgage so forgive me if i miss any information or get any terms wrong! I am currently applying for my first mortgage with my partner (its not his first mortgage) but unfortunately i seem to have a poor credit rating and 1 default which is annoyingly 5 years old and only for £260! we have found our perfect place to buy! The property is 195,000 and we have a 30,000 deposit 20,000 of that being gifted, i did get an AIP with halifax today but one mortgage broker says our chances are slim and would struggle to help us! So we are currently using another one who may be able help us! but i just wanted peoples opinions on the likelihood of us being accepted and any success stories of people who have been in a similar situation? 

K_S

@TanJ23 welcome to the forum!

Assuming there are no other nasties in the background and based purely on the very limited information in your post, I would expect there to be options available to you. I would be very surprised if one 5 year old default worth £260 between the two of you led to you missing out on mainstream-ish rates with a 15% deposit.

"one mortgage broker says our chances are slim and would struggle to help us" What did that broker mean, did they say that they can or can't help you? Did they specifically cite the default as a reason for not being able to help?

If you don't mind me asking, was the default satisfied and what is it in relation to? Is there anything else other than this default - late payments, missed payments, arrears, etc on either of your credit histories?

I'll be honest, the fact that you passed a Halifax DIP is definitely a positive sign, though as I'm sure you know, not a guarantee of an offer.

TanJ23

Thank you for your response! He said his gut feeling was it would be very difficult to get the amount we are after with our deposit and low credit scores and the default (although my partners score is fair with no late payments or anything) He didn't give us much indication that he wanted to put the work in and had a gut feeling it wouldn't work! So we went elsewhere! 

The default is a strange one its with SSE and it doesn't state satisfied i did notice this a year ago on my file and proceeded to email them asking if i had anything to pay them, Their response was your account was closed and finialed with zero balance! So this suggests to me it should say satisfied although i was unaware of this debt to begin with.

Yes i have done a bit of research and Halifax seems to be a good one to go with but i honestly have no knowledge on this and am just hoping that the new broker is working hard behind the scenes (i did forward the email to him from SSE) I have also since emailed them again asking for any information as to why its on my report. 

Sorry for the long post i am unsure how to 'tag' names so that i am replying to a specific post! 

K_S

@TanJ23 Yeah, it looks like the first one just wanted to fob you off.

Kudos on sticking to using a broker, absolutely the right thing to do rather than go blind with one lender. Hopefully the new one will get you what you need. I hope he isn't charging a bomb terming you as 'adverse'. If that one 5 year old default is all there is to it, I would be reluctant to go down that route yet, especially since you passed a Halifax DIP.

SSE might be saying zero balance because they may have sold on your debt to someone else at some point in the intervening period.

TanJ23

I would agree!

No fees or adverse mentions at the moment so fingers crossed he's just treating us as a normal case, from what i can see everything else on the report is clean! I did start working on it early last year to make it better (monitoring it on money supermarket credit score, probably not the best one, realise that now) so I'm gutted that this default is getting in my way! 

That would make sense with the SSE comment although as i say so frustrating considering i had no knowledge of this debt and am aware i need to be as open and honest as i can when applying for mortgages but it wont look that way if I'm saying i didn't know about it! 

Would it be worth telling my broker i got an AIP? I did it on a whim today as I'm being impatient!

Thank you for your responses i really appreciate it!

K_S

@TanJ23 If I were your broker, I'd definitely prefer to know of any DIPs that the client has already done, whether successful or not.

ACG

Its never a good idea to be doing something someone else is doing. If any information is entered differently on the 2 - which can happen if you interpret things differently or do not enter it as the lender would want, you can find your being flagged for fraudulant applications - there was a thread on here not too long ago where that happened, although in fairness that one looked quite dodgy. 

A 5 year old default, I would expect to be able to get through at normal rates. Although things are assessed a little more harshly this year compared to last year. 

TanJ23

That's all really helpful, Thank you!

I just didn't want to look like i was pushing my broker to move quicker as he only received our information yesterday! That's very reassuring considering our initial advice! 

ACG- We won't be applying for any mortgages directly to the lender, I wouldn't want that to happen! I hope an AIP wouldn't make it look like that!

Thank you again for your responses