Mortgage First time buyers - Credit Score

Lucywrix

So, first, here's a little background about me and my partner.
Credit scores - I have a perfect credit score (990/999 on Experian,) However, I do have an overdraft of £500. I have 2 active credit account but with no balances on them and have always paid them off in full in the past. The last time I used one was over Christmas (only for £100) and paid it back in full in January this year. I also have a store card with Very which is at £600 (I make regular payments each month.) All my debts total up to £1200.
My Partner - His credit score is fair (725999 on Experian.) Due to his mother being an alcoholic and not paying bills, my boyfriend had to get a few PDL's in 2018/2019/2020 to help pay for bills, electricity, gas, etc... All of these PDL's are now paid off. He has 2 missed payments which are quite recent (Dec/Jan 2020) but it was only for £33 and he paid it off straight after he was notified of it. My partner has a credit limit with Indigo Michael of £400 and he has used £350 of it, this is always paid off, in full, every month and he won't be using it again after this month. As well as this he also has a Very Store Card which is at £300 (he makes regular payments every month of £10.)   

We both have a combined income of around £40,000 annually. We are both in full-time work and have 0 dependants, 0 car finance, and 0 adverse credit/defaults.

The property is on the HTB equity scheme (5% deposit, 20% Loans, 75% Mortgage.) On market for £210,000.
Even though it is only a 5% deposit (£10,500), I do have £15,000 to put towards it if need be. But, I was actually going to pay off ALL of our remaining debt with this money that will be leftover. May I add - the deposit is gifted and if from my father who has been saving up shares for me since I was born.

We applied for an AIP with Santander through a Broker (Burchell Edwards) on 05/03/21 and it was accepted! We did the full application on 08/03/21, Valuation was done on 10/03/21, Santander asked for more documents (P60) on 11/03/21 and they were submitted the same day. We have heard nothing since. Some people on here are going to tell me I'm impatient, I know! But when you've found your dream home, It's hard to stop the anxiety.

Has anyone been in a similar circumstance or had Clients who have been in a similar circumstance in the past and have been approved? I know getting an AIP is good news but it doesn't secure the mortgage.

Elchie232

Just to let you know, your credit score means nothing, its just a marketing/simplicity tool for customers.  PDL and missed payments can be quite a big turn off for banks, because of this the underwriters will probably take longer with the affordability and credit checks etc.   The fact it is all paid off and you have an AIP, I wouldn't be too concerned. Normal circumstances it can take about 3 weeks for the offer.  Maybe call Santander at the end of the month for an update if you haven't herd anything back?  

Lucywrix

@Elchie232 Thanks for that, PDL's are a massive turn-off, I know that they just.. well... look bad :') 
I made him get rid of these as soon as he could, he even borrowed money off family, in the end, to get them all gone. 
You reckon that the AIP being accepted is a good thing? They've done a hard check on our credit reports so surely if there was an issue there they would of brought it up when they asked for more documents?

Elchie232

Without knowing everything in your credit report haha, I would say the AIP is a good thing.  It is uncommon for mortgage to be decline after an AIP.  The initial credit check on your report will be mainly for fraud, identity and basically to check all the loans and credit cards etc. you have stated are there, and to see anything you have not declared.  Now that you have submitted the formal mortgage application, the bank underwriters are basically calculating the risk (of loaning the money) to reward (interest paid back). This can sometimes take ages haha.  Even though they havent said it is an issue, the PDL and missed payments will definitely be factoring in with the "risk", along with store cards and another unsecured debts.  At the end of the day, this will only matter if they decide you can not afford the mortgage or on the cusp, but if you a big enough salary and the mortgage is not a huge proportion, I would have though you would be okay.   

Lucywrix

@Elchie232 Thanks for that Mortgage payments will be £550 a month. All together for absolutely everything I can think of we should be paying £1600 MAX, that's including insurance, council tax and entertainment per month. That leaves us £1000 towards anything we please or savings.

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Lucywrix said:

@Elchie232 Thanks for that Mortgage payments will be £550 a month. All together for absolutely everything I can think of we should be paying £1600 MAX, that's including insurance, council tax and entertainment per month. That leaves us £1000 towards anything we please or savings.

Hi there. In similar situation. Santander dip approved. Full application went in on 17/03, been back and forward with underwriters 3 times now.
All credit cards and store accounts are 0 and were before we had full application in however my partner had a small payday loan in 2020 which is now paid off. This is the first one he's ever had with no missed payments or anything in either of our credit files. Just wondering how you are getting on with your application? 

[Deleted User]

Have you contacted Santander while you've been waiting?

The reason I ask is because some of my documents went missing between dropping them off at my local branch, and the office where they deal with it. (mine wasn't santander, so I'm not slating them, or indeed my lender, these things can happen). Anyway, I didn't know the documents had gone missing until due to my excitement and impatience I rang them about a couple of weeks later to see how they were getting on. Luckily it was easily resolved, as the missing docs were copies rather than originals, so I just had to go into the branch again. I had to tell my solicitor though, who in turn spoke to the vendor, and agreed a 2 week extension. 

Xenon

Should there not be some "sticky" thread or something to explain for the thousandth time that credit scores mean nothing !