Help needed please.

Fzzzbucks

My partner and I are looking to buy a home for the first time and would like a 100% mortgage which also combines a loan that would pay off our existing debts (16k between us). We have both had missed payments on credit agreements in the past but have kept these up to date regularly now and are comfortable with repayments.

We have both checked our files on Experian and are still classed as high risk borrowers. We think this may be partly to do with the missed payments and partly to do with us only living in our rented flat for a few months and we have no new credit agreements here.

We applied for a mortgage with Northern Rock but got turned down. We have written down all of our commitments and would be much better off financially after the mortgage than we are now.

Can you recommend anything that will help us improve our credit scores or do you have any other advice for us?

FLEX24

Im a bit out of touch with this sort of thing having left a sub-prime mortgage lender a few years ago( and I was in an admin post) so I will only give vague suggestions.

There are plenty of Mortgage magazines in the shops, buy one or 2 (or stand with the rest of us and read for free!!!).

You may well have to go to a Sub-prime lender(ie lending to those with difficult finances). Some High-street lenders have their own. Or possibly go to a Mortgage shop where they act for various lenders. Arrange an interview,tell them your position and see what they say. Theres no harm asking! But remember the lenders will charge more fees and what-have-you because you are a bigger risk and carrying more 'baggage' than the ordinary Joe with a deposit and good credit rating.

Your commitment list is good as it shows how you stand, take that with you as the more info you have the better.

Otherwise it could be you need to get rid of the debt first before you can go any further. Again talk to someone.

herbiesjp

100% mortgages are indeed higher risk, and therefore have tighter/stricter underwriting and credit scoring procedures.

Fairdo_2

As Herbie SJP stated, you would be considered a high risk at 100%.

The only Lenders that would deal with your circumstances (ignoring credit status) would be Coventry Building Society on a "Moregage" scheme.

Accord Mortgages also offer 100% mortgages and will ignore credit commitments for loans and credit cards.

Another possibility is to make your existing credit commitments a bit more affordable by consolidating them.

Fzzzbucks

We spoke to our mortgage adviser and have been given a loan by Coventry Building Society. Thanks for everyone who helped out.

meanmachine_2

Fzzzbucks wrote:

We spoke to our mortgage adviser and have been given a loan by Coventry Building Society. Thanks for everyone who helped out.

What's the interest rate on that? I bet it's shocking - something over 6% I wouldn't wonder....

Still, if you can meet the payments, good luck to you.

Fairdo_2

meanmachine wrote:

What's the interest rate on that? I bet it's shocking - something over 6% I wouldn't wonder....

Still, if you can meet the payments, good luck to you.

6.49% to 6.6% depending on whether you go Fixed or Capped.

Considering an element of this can be on an unsecured loan basis, this is not so unattractive. Granted, there are better rates out there, but sometimes it's a case of getting what you can take. As it would be considered a bit riskier, a Lender could say they have justified this rate by saying yes to the loan.