Mortgage/ loan with credit issues !

anniemc89

Hi there would really appreciate some advice ! My partner and I are currently renting from my mum. We need a larger house due to recently having our third baby.
My mum is gifting us £40000 cash and also approximately £40,000 equity from the sale of the house we are currently in. 

The houses in our area that we would be looking to buy would require an additional £30000 mortgage loan.
The problem is my partner had a mortgage with a previous girlfriend that although he has not been with for 10 years, he only got his name removed from in October 2019. This mortgage was in arrears. His credit rating is now excellent however the after we were pre approved for a mortgage we were told his history of his last mortgage would be a problem for a few years to come. Are there any options given the relatively small mortgage we require as we have a very large cash deposit ? Or any other kind of loan ? Thank you 😊 

anniemc89

Our joint income is £30000....

MWT

Find a broker who specialises in adverse credit situations.

Your partners current credit rating is of no real interest to a lender just the events they see on his credit file so it will need some explaining, not just a simple application.

anniemc89

The couple advisors we have tried have said we need at least 2-6 years clear...not sure if we will get the same answer everywhere or if there’s any hope. Frustrating as we can provide a large deposit ! 

ACG

12 months clear with a 75% deposit should be possible, rates may not be great. I would like to think it could be placed at rates of around 2.5% but that is based on limited information. 

An alternative could be to buy it in your name and then add him in a few years, but I am always reluctant to do that as an advisor as there are potential problems that can arise. 

anniemc89

Thanks for your reply! Any suggestions of where we could try ? We’re happy to pay higher interest rates if necessary.

K_S

anniemc89 said:

Thanks for your reply! Any suggestions of where we could try ? We’re happy to pay higher interest rates if necessary.

If you want both names on the mortgage, your best option would be to find an adverse credit broker to place your case. Mind you, with a mortgage as small as the one you're looking for and the work involved in placing the case, you will most likely have to pay a fee which may seem large in percentage terms.

The alternative is going lender by lender checking who may treat your scenario favourably but that isn't something I'd recommend for an adverse credit mortgage.