My Bipolar Credit file - impact on mortgage.

custhasno

sheeesh where do I start. I was diagnosed as bipolar (it's more complex but that's the simple term) in 2020 and with my medication now my life is so much better.

The problem is I was extremely financially irresponsible, and was taking out lots of payday loans to fund a spending habit that my income could not support. Defaulting on them with no intention to repay. 

I've since sorted myself out and have now satisfied everything since about Aug 2020. unfortunately I didn't get to challenge any lending as Sunny and a few others had gone belly up and past any deadline to complain about mis-selling. The end result is 8 adverse marks on Experian, 4 on Equifax and 4 on TransUnion, which wont drop off until 2026/27.

So now my wife and I are saving for a deposit for a mortgage (in Northern Ireland). We should have about 6k each in a help to buy ISA (first time buyers) for a total of 10% deposit. But I'm terrified that when we get to applying my adverse marks are going to result in lenders setting a price that our affordability wont pass. We currently rent a council house, but don't want to buy it, its too small (daughters 10 & 7 share a room) and neighbours are a nightmare. We are really on a short timer to go for a house due to several factors including turn key new builds in our village and kids that are suffering for our mistakes. If we have to eat !!!!!! ( in terms of mortgages) to achieve that, it's a cost we are willing to pay. We are both in our early 40s and understand the inevitable shorter term length will result in higher repayments. 

I live every day in fear that my past mistakes are going to affect my kids and I feel like a failure. I thought it would be a good idea to try to build my rating by having some credit so I have about 5k in debt between a store card credit card and personal loan. My score is hovering around threshold of needs improvement to poor. My payments are regular and on time now always. 

We will be looking at a house around 150-195K with approx.15k deposit. My wife is getting her hopes up about schemes with nationwide and others relating to 95% mortgages. I'm just afraid we wont get due to our credit history. At the height of my episodes my wife took out a debt relief order for her debt (we were not financially linked at the time but are now this year) so we feel trapped. it is discharged now but still will show for another 4-5 years. 

Any advice on what to expect or what to work on between now and Q1-2 2024 when we go to start speaking with mortgages advisors would be greatly appreciated? I've been afraid to ask up until this point.

chanz4

Get a broker to deal, they will know best way to deal

RelievedSheff

You really need a decent broker who deals with adverse credit cases. They will be best placed to tell you if you stand any chance and what you can do to improve your chances.

ACG

I am all for having some credit to help build your credit score, but £5k to me reads that you are still not on top of your issue of living beyond your means. Unless there is a very good reason (medical bills for example), there is no need to have £5k worth of debt. A grand, maybe but in the words of a lender we use a lot, it looks like you have a "propensity to debt". Although I suppose there is the argument that rather than paying that down you need to concentrate on the deposit. Stop running up the debt any more. It wont do you any favours. 

As for everything else, as you are in NI, you have a very different market to the likes of England and Wales. Over here we have Adverse lenders, specialist lenders, high street and building societies. In NI your options are going to be a little more limited. 

I think you need to speak to a broker really and I think probably one in NI is best. If you were in England, I would say its potentially doable but the lenders I would be looking at do not lend in NI so I am not sure where you stand.

Sorry to sound like I am having a dig btw. You have kept a roof over your kids heads despite everything. Thats more than some people manage to do. I grew up on a council estate and there were times where we struggled. To be completely honest with you, I never actually realised until I was older, your kids probably done realise either as they have not known anything different. If you manager to get to where you want to be, they will probably appreciate it all the more. Best of luck. 

custhasno

ACG said:

I am all for having some credit to help build your credit score, but £5k to me reads that you are still not on top of your issue of living beyond your means. Unless there is a very good reason (medical bills for example), there is no need to have £5k worth of debt. A grand, maybe but in the words of a lender we use a lot, it looks like you have a "propensity to debt". Although I suppose there is the argument that rather than paying that down you need to concentrate on the deposit. Stop running up the debt any more. It wont do you any favours. 

As for everything else, as you are in NI, you have a very different market to the likes of England and Wales. Over here we have Adverse lenders, specialist lenders, high street and building societies. In NI your options are going to be a little more limited. 

I think you need to speak to a broker really and I think probably one in NI is best. If you were in England, I would say its potentially doable but the lenders I would be looking at do not lend in NI so I am not sure where you stand.

Sorry to sound like I am having a dig btw. You have kept a roof over your kids heads despite everything. Thats more than some people manage to do. I grew up on a council estate and there were times where we struggled. To be completely honest with you, I never actually realised until I was older, your kids probably done realise either as they have not known anything different. If you manager to get to where you want to be, they will probably appreciate it all the more. Best of luck. 

Thanks, yeah it's 500 on a credit card, 500 on store card and 5k on a car finance. All will be cleared by the time we apply. Just wasn't sure if paying them early would improve the score as much as completing the payment schedule. I understand we are paying more interest to do so though.

No19v87

Just so you know, the companies which have gone bust - put a dispute in with the credit reference agencies, the company will not respond within 28 days and the reference agency will remove it from your credit file.

May not prevent you from having to use an adverse credit lender, but might help your cause.

MWT

custhasno said:

ACG said:

I am all for having some credit to help build your credit score, but £5k to me reads that you are still not on top of your issue of living beyond your means. Unless there is a very good reason (medical bills for example), there is no need to have £5k worth of debt. A grand, maybe but in the words of a lender we use a lot, it looks like you have a "propensity to debt". Although I suppose there is the argument that rather than paying that down you need to concentrate on the deposit. Stop running up the debt any more. It wont do you any favours. 

As for everything else, as you are in NI, you have a very different market to the likes of England and Wales. Over here we have Adverse lenders, specialist lenders, high street and building societies. In NI your options are going to be a little more limited. 

I think you need to speak to a broker really and I think probably one in NI is best. If you were in England, I would say its potentially doable but the lenders I would be looking at do not lend in NI so I am not sure where you stand.

Sorry to sound like I am having a dig btw. You have kept a roof over your kids heads despite everything. Thats more than some people manage to do. I grew up on a council estate and there were times where we struggled. To be completely honest with you, I never actually realised until I was older, your kids probably done realise either as they have not known anything different. If you manager to get to where you want to be, they will probably appreciate it all the more. Best of luck. 

Thanks, yeah it's 500 on a credit card, 500 on store card and 5k on a car finance. All will be cleared by the time we apply. Just wasn't sure if paying them early would improve the score as much as completing the payment schedule. I understand we are paying more interest to do so though.

The scores you see online are of no direct interest to the lenders so don't focus on massaging them in different ways to get a few more points, what matters more to the lenders are the historical adverse events recorded on your file and the amount of debt you have outstanding, so getting it paid off is the important part, rather than following a schedule and doing it more slowly as a result.

MorningcoffeeIV

custhasno said:

ACG said:

I am all for having some credit to help build your credit score, but £5k to me reads that you are still not on top of your issue of living beyond your means. Unless there is a very good reason (medical bills for example), there is no need to have £5k worth of debt. A grand, maybe but in the words of a lender we use a lot, it looks like you have a "propensity to debt". Although I suppose there is the argument that rather than paying that down you need to concentrate on the deposit. Stop running up the debt any more. It wont do you any favours. 

As for everything else, as you are in NI, you have a very different market to the likes of England and Wales. Over here we have Adverse lenders, specialist lenders, high street and building societies. In NI your options are going to be a little more limited. 

I think you need to speak to a broker really and I think probably one in NI is best. If you were in England, I would say its potentially doable but the lenders I would be looking at do not lend in NI so I am not sure where you stand.

Sorry to sound like I am having a dig btw. You have kept a roof over your kids heads despite everything. Thats more than some people manage to do. I grew up on a council estate and there were times where we struggled. To be completely honest with you, I never actually realised until I was older, your kids probably done realise either as they have not known anything different. If you manager to get to where you want to be, they will probably appreciate it all the more. Best of luck. 

Thanks, yeah it's 500 on a credit card, 500 on store card and 5k on a car finance. All will be cleared by the time we apply. Just wasn't sure if paying them early would improve the score as much as completing the payment schedule. I understand we are paying more interest to do so though.

You're chasing an imaginary score while making yourself look high risk to lenders and paying for the privilege through interest.

Clear the debts. Use your credit card but clear it in full every month.

ACG

No19v87 said:

Just so you know, the companies which have gone bust - put a dispute in with the credit reference agencies, the company will not respond within 28 days and the reference agency will remove it from your credit file.

May not prevent you from having to use an adverse credit lender, but might help your cause.

I did not know this. Good to know. 

summerb64

ACG said:

No19v87 said:

Just so you know, the companies which have gone bust - put a dispute in with the credit reference agencies, the company will not respond within 28 days and the reference agency will remove it from your credit file.

May not prevent you from having to use an adverse credit lender, but might help your cause.

I did not know this. Good to know. 

They don’t remove it from your credit report, rather they ‘suppress it” from showing on your credit report. The default still exists