Advice for mortgage with a default

storm45

Hello, 

I hope you are all well.

I am looking to possibly purchase a flat with my partner however I don't know where I stand in regards to a mortgage as my credit history is not clean. The details are as below:

- looking to buy a flat which is between £350-400k
- our combined income is £71,400
- we have savings of £70k currently

The problem I have is that I got into financial trouble and so have missed payments leading to a default on a credit card, the amount was £9k. The default was applied on 25/02/2018 and I have just paid it off on 12/04/2022. In hindsight, I wish I had paid it off earlier, as I always had the intention of paying my debt but didn't understand until now that timing matters too. 

Other than that one default, my credit file has been clean ever since and my partners is nearly perfect. 

I just wanted some help and advice in the following scenarios please:

1 - Would I get any mortgage at this present time? And if so, what kind of amount and rate should I expect?

2 - If I wait for one year to pass since I have settled the default, and the default has become 5yrs old, what kind of amount and rate should I expect?

3 - last option is to wait for the default to drop off but I am really hoping I don't have to wait that long.

Any help with this would be much appreciated and apologies if I have missed out any other key information.

ACG

1. Yes there should be lenders. You should be able to get a little more than you need. Rate wise, tricky one, it could potentially be normal rates (2% ish) but it could be closer to 4%. Difficult to say for sure as the devil is in the detail. 

2. Similar to above, more likely to get normal rates. But nobody knows what normal rates will look like in 12 months. 

3. Probably answered above. 

storm45

ACG said:

1. Yes there should be lenders. You should be able to get a little more than you need. Rate wise, tricky one, it could potentially be normal rates (2% ish) but it could be closer to 4%. Difficult to say for sure as the devil is in the detail. 

2. Similar to above, more likely to get normal rates. But nobody knows what normal rates will look like in 12 months. 

3. Probably answered above. 

Thanks ACG, really helpful and reassuring. 

I think we'll give it a few months and save a bit more for a higher deposit.

I am definitely going to go with a mortgage broker but in your opinion, do I need to look for an adverse credit broker? Thanks in advance 

ACG

I dont think you necessarily need a specialist adverse broker, probably more of a good experienced broker. 
That being said, specialist adverse brokers dont automatically go to adverse lenders. I would say only a third of our adverse cases end up with adverse lenders. 

storm45

ACG said:

I dont think you necessarily need a specialist adverse broker, probably more of a good experienced broker. 
That being said, specialist adverse brokers dont automatically go to adverse lenders. I would say only a third of our adverse cases end up with adverse lenders. 

Ah ok, that makes sense. I totally thought they would just go straight to adverse lenders.

When the time comes, i'll definitely go for an experienced broker, I don't mind paying a fee for good advice and peace of mind. I'll come back here when i'm ready to move forward just in case there arenany changes. Thank you for your help.