What would you do ?

happy2017

Hi,

I started a DMP with StepChange in May 2019 and since a few months back have started to self manage my own debt.

I have a bank account that my salary goes in and I use them for bills and every day spending.

I transfer enough money each month to another account where all the payments go to my creditors I’ve defaulted with and have arrangements in place.

Im hoping that by the end of the 2025 all the defaults will have gone from my credit file.

I really want to own a home in 2026 but wondered if paying small amounts each month to my creditors will be frowned upon by mortgage lenders.

Should I look over the next year or so to put in 30% offers to my creditors or which I owe £38k across 15 lenders?

Is it best all the debt is gone even though it’s not on my credit file before applying for a mortgage?

 Thanks.

COYI123

happy2017 said:

Hi,

I started a DMP with StepChange in May 2019 and since a few months back have started to self manage my own debt.

I have a bank account that my salary goes in and I use them for bills and every day spending.

I transfer enough money each month to another account where all the payments go to my creditors I’ve defaulted with and have arrangements in place.

Im hoping that by the end of the 2025 all the defaults will have gone from my credit file.

I really want to own a home in 2026 but wondered if paying small amounts each month to my creditors will be frowned upon by mortgage lenders.

Should I look over the next year or so to put in 30% offers to my creditors or which I owe £38k across 15 lenders?

Is it best all the debt is gone even though it’s not on my credit file before applying for a mortgage?

 Thanks.

All depends on your debt to income ratio and how you have been managing you’re debt (I.e. missed payments or not , relying on credit cards ) . If you are heavy in debt , depending on you’re monthly payments , will determine how much a lender will lend as they determine the risk . Also how big is your deposit % wise roughly . What would you estimate it to be around 2026 , compared to what the house price is you are roughly looking to get . I’d speak to a broker closer to the year you want to buy a house personally .