Will I be able to get a new mortgage

sillygirl24

Hi All

Was wondering if I could please have some advice? Ive also posted this on the debt free wannabe but the guys there said to also try here.

My partner are I are splitting up and our house is on the market, we have a 4 year old who will come and live with me but I am terrified I will not be able to get another mortgage due to our credit rating and we will have nowhere to live.

Once our house is sold I should be left with about £9 or £10,000 profit. Im not sure what to do with this money. I have debts of about £3000 and although not huge I have only recently started to repay them so I have a few defaults and constantly recieve letters from debt collection agencies.

Is it better for me to pay these debts off and hope a mortgage company will lend to me? My current mortgage rate is 8.3% which is really high but affordable when there was 2 of us. If I pay off all my debts is it likely I will get a better rate?

I can move in with my parents for a while to let me save some more money for a deposit but not longterm as theres not enough room for me and my daughter.

Im struggling to cope as it is but the worry that I wont be able to get another house is getting too much so if anyone could give me some advice I would really appreciate it.

Thanks
Sillygirl24

poppy10_2

1) Pay the debts off.

2) Rent somewhere for a lot cheaper than an 8.3% mortgage would be.

3) Be happy

UK007BullDog

In todays market and depending where you live your money might not be enough for a good deposit and with your defaults you might need up to 25% deposit for a subprime mortgage.

Pay off your debts and rent and start to repair your credit file. 2 to 3 years to prove yourself and also to save up a decent deposit, then you can buy again.

sillygirl24

UK007BullDog wrote: »

In todays market and depending where you live your money might not be enough for a good deposit and with your defaults you might need up to 25% deposit for a subprime mortgage.

Pay off your debts and rent and start to repair your credit file. 2 to 3 years to prove yourself and also to save up a decent deposit, then you can buy again.

If I have no alternative then I will rent and put my money away in the bank but if there is any possibility that I can buy again then I would want to try that first.

Property is quite cheap where live and I could get a small house or a nice flat for about £85000 - £90000. I will have £7000 left once debts paid off and could save about £1000 per month by living with parents for a while. (cant do this longterm as there is not enough room but could stay for up to 6 months or so) I clear about £1500 - 1600 per month, £78 Child Benefit, no tax credits and £124 per month maintenance from ex. My only outgoings will be £140 per month for my car (going to try and get a cheaper one) as I will have paid of my credit cards and loan

Are there any mortgage advisors around who would be able to let me know if I could get a mortgage on these figures?

Thanks

Kez100

Have you actually sold yet? If not, is that profit you expect to be left over based on achieveing full asking price?

sillygirl24

Kez100 wrote: »

Have you actually sold yet? If not, is that profit you expect to be left over based on achieveing full asking price?

No Its not sold yet but has had offers. Its on for £175000 and my figures are worked out on getting £170000 just to be safe.

girl2308

hi
Although i know nothing about mortgages etc,i just thought i would let you know that i think should be able to get some extra money via tax credits,there is a very straightforward form to fill on the there web site (just do a google search) ,and it will tell you there what you should be able to claim,i am also single mum,earning about same as you, and get tax credits,hope this is of some help.