Debt collection searches - impact of mortgage application

Oni0nMan

Hi all,

I've posted a more detailed thread over at the Debt free board but wanted to enquire about a specific issues I'm worried about here.

My partner has an unpaid debt from '09 for around £5k, CCJ registered in '15 and now off the public register.

We've been trying to pay this off after recently after coming into money but Northampton Court no longer has record of it and she has no other details. I'm also under the impression asking the original creditor would cause searches to be carried out on her too.

We're worried that the current debt collection agency might decide to run a debt collection search on her, we're currently looking to buy a new build property where contracts are exchanged early (binding us to buy) and completion wouldn't be for another 7 odd months.

This means that our mortgage offer would be waiting for those 7 months too, meaning any debt collection searches in that time could potentially impact the completion of the house and the loss of our deposit.

My question is does anyone know how much of an impact a debt collection search would have on our application? Would this search cause a mortgage of fall through or are there options?

Many thanks!

[Deleted User]

It depends if they show as hard or soft searches.

Too many hard searches can cause an issue, but they're very unlikely to do more than one, once they've found her.

It'd be simpler to contact the creditor and get the debt paid, so they have no reason to search her and you no longer have to declare the debt for your application.

cymruchris

Are you saying that you don't know the details of whom you owe the money to? a debt collection search can be a negative - it's visible to others unlike soft searches that aren't. I had one appear on my files in 2019 from a company I'd dealt with back in 2012 prior to bankruptcy. Their debt was written off by that procedure, however I'm aware from the final official receivers report that they got their money back in full. I couldn't understand why they'd run the debt collection search - but all of their contact numbers/emails and website in 2021 didn't work anymore - and challenging it with transunion got me nowhere. I didn't mind too much as I knew there wasn't a debt, and that for the time it appeared (2 years) I wasn't applying for a mortgage. 

I imagine if one is completed - you'll then be able to track them down, and arrange payment in full on the condition the debt search is removed. (I can't imagine them saying no to that - but if it happens get it in writing).