FTB Mortgage concerns

paddyposh

Hi all. Me and my wife are looking at buying a house and I have been doing a lot of research. I have filled in of our information on L&C very carefully and it gave me an amount with some results (top one being Santander). I’ve also done one with Better which I didn’t have to put financial info into but it says it links with Experian, and that gave me a similar amount. I also looked at uswitch which gave me some results

I am waiting on a call back from someone today from elsewhere after providing statements etc (was looking at new builds shared ownership and did the affordability call with them)

I did an affordability calc on Santander direct and it said they could lend X, so I went and filled in a MIP application directly on the their website and it said your decision in principle has been declined. I then got an email from Santander saying to please call them to discuss the MIP, which I am going to do this morning.

I am now quite concerned as after L&C / Better both indicated I could and provided a MIP cert, to then have one declined directly with them if making me worry.

No complexities around earnings etc, all credit card/outgoings were listed same on both

Are my concerns valid? And should I go through all of this with an independent broker on the phone (a different company to one I’ve mentioned above, I have a recommendation or two from friends or local ones) ?

paddyposh

So I just spoke to Santander and all they could say was that it was declined due to something unsatisfactory on credit file, and to check it. I’ve been doing this a lot lately and there is a missed payment or 2 from 3 years ago with water company, rectified and back to normal status within 2 months, but that’s it. Any prior adverse credit issues were knocked off and no long show on any

Exodi

https://forums.moneysavingexpert.com/discussion/comment/81915231#Comment_81915231

Have you checked all three credit reference agencies (as they all act independently and creditors can report to any or all of them)? Doing so for you, and your wife?

You can do so for free - Experian (using the Experian app), Equifax (using the ClearScore app) and TransUnion (using the Credit Karma app or MSE Credit Club).

If that is the only thing on all of your credit files, then it would seem Santander are unhappy to lend with the water company default on the credit file, even if it was 3 years ago. Fortunately there are many lenders out there and many aren't as strict.

paddyposh

https://forums.moneysavingexpert.com/discussion/comment/81915324#Comment_81915324

Yes I have been checking them all recently, and gone through with a fine tooth comb. I pay monthly for Equifax and I am on a free trial for CheckMyFile currently.

I did also do a sole application and I got the same outcome however this time the Santander rep was a bit more helpful and advised I could do it over the phone with them and after explaining the negative parts I have found on my file, he said they can do a hard search for MIP and if declined it could be appealed based on what I had told him. Their affordability calc after putting in my incomings and current credit debts suggested they could lend me upto around 280k with a 14k deposit.

Having gone over the files, I have found some missed payments for Anglian Water 2021-2022 (no defaults), where it then went to an arrangement to pay. The payment was cleared and back to normal, reporting OK from March 2023. So nothing in the past 3 years.

There is also a missed payment showing against my old EON account from Feb 2020 (only showing on Equifax), which should now have dropped off as it has been over 6 years. I have raised a case with Equifax about this to have it now show up anymore and waiting to hear.

Same as above there is 1 missed payment showing against an old O2 account which is closed. The missed payment is showing a 1 just on Experian, and is from 2018 so again this should not be showing up now? I have raised a case with Experian about this.

So in short to summarise the last 'negative' for my credit file was 3 years ago and it has been reported fine ever since.

Exodi

paddyposh

Yes I have been checking them all recently, and gone through with a fine tooth comb. I pay monthly for Equifax and I am on a free trial for CheckMyFile currently.

Well as mentioned you can check all 3 for free, but it's good you have insight into all of them. Is this for your wife also?

So you have an AR maker from Anglian Water which was cleared 3 years ago, a missed payment marker from EON which was 6 years ago (but hasn't cleared yet) and a missed payment marker from O2 which should have been removed

Personally I wouldn't be raising cases to Equifax about EON just yet, given the timing (Feb 2020) you've only just hit the 6 years and given refresh and reporting intervals it is likely that it will disappear naturally within the next month or so. With O2, yes certainly query it.

But personally, I wouldn't worry too much on it, given how long ago the defaults were. Plenty of lenders will not have an issue with this (nor likely Santander if you did a formal application). You mentioned you're using L&C, so this is certainly something they should help you with.

RelievedSheff

Let your broker do their job.

By making random applications yourself you will only make matters worse!!

paddyposh

https://forums.moneysavingexpert.com/discussion/comment/81915642#Comment_81915642

I had a long call with the broker today, gave him details on outstanding credit balances etc, mentioned the missed payment markers from 2022/2023 and he recommended a lender option pretty quickly. We are going to sit down tomorrow to do an AIP and see what happens.

paddyposh

https://forums.moneysavingexpert.com/discussion/comment/81915642#Comment_81915642

So update. My broker had a declined AIP with Accord which he thinks is probably due to the default and some high % CC utilisation. It came back with failing credit scoring

I spoke to another firm after (Simply Lending) and they ran through everything, via connecting with Experian and got me a DIP with a lender (not known atm, presumably so i dont just go direct), 5.8% 2yr fix, but there is a lender fee of £1999 to be paid if we go ahead.

The person at Simply Lending does think based on what he got back we are maybe a couple of months away from looking at more high street instead of specialist, depending if we can chip away at CCs

We are in a position though where we dont have that long (landlord given notice and is selling, estate agents implied extension to notice could be OK if we prove we are in process of byuying)

Does that seem too unreasonable figure wise? In 2 years we should then be in a better position (less utilisation on cards, another 2 years further from my missed payments, and maybe wife will be working). I feel like that rate is OK personally but keen to hear thoughts

kingstreet

It sounds like you've been taken from the top of the high street charts to adverse specialists with no stop in the middle. I'd say this would suit a smaller building society with a "no credit scoring" approach where human beings make the decisions. @ACG

RelievedSheff

If you are happy with the rate short term, it is only two years after all, then that is all that matters.

We have taken a shorter term high interest rate to secure the property we wanted in the past and then remortgaged to high street rates after the two years. It worked for us.

Although if you are only a couple of months away from better rates you could apply with a high street lender further down the line. Conveyancing will take more than a couple of months anyway.

Myci85

When does the notice expire on your rental? As in reality you don't have to move out by that date, it is just a notice that your landlord intends to go their court to get the property back. It could take another 6 months from the notice date for you to actually be evicted, which might buy you enough time to apply for a mortgage at more normal rates (and without the high lender fee... is that the lender fee or broker fee?)