Mortgage options

B-DOG_2 · 26 July 2017 at 9:29PM

Hi all, I completed my IVA in August last year and I got my certificate through in January.
Now that that I've tied up all loose ends and am completely debt free, I'd really like to look into getting a mortgage.
I have checked my credit file and I obviously have no open debts,however one from my Iva is still there (showing as settled and closed). Should I contact the credit company to have it removed or would it have no impact?
I've got an aqua credit card which I've had for a couple of months to try and build back my credit rating and have kept this perfectly in order.
My only other issue is after 6 years of being in an Iva etc, I haven't been in a position to save so a deposit isn't going to be possible unless I leave it a couple of years.
As I'm 40 this year, I'd like to get a mortgage sooner rather than later and I've seen that 100% mortgages are back.
Should I go for it and apply or would they not touch me with a barge pole? I have no debt whatsoever and look to get a fairly small mortgage (about 3x my annual salary).

Thanks in advance
B

National_Debtline · 27 July 2017 at 11:51AM

Hi B-DOG

Well done on completing the IVA, I’m sure it’s a great feeling. You’ve mentioned you were in the IVA for 6 years so I’m assuming that has now dropped off your credit file. With regards to the debt that is still showing, it will drop off 6 years after the date of the default. If a default was never registered it will drop off 6 years after the account was settled. A creditor does not have to agree to remove a debt any sooner than this.

With regards to taking out a 100% mortgage I would recommend you to seek some financial advice. Bear in mind that the terms are likely to be less favourable than a mortgage where you put down a deposit, for example you could be charged a higher rate of interest and it’s really important to check that it will be comfortably affordable. Think about what will happen if interest rates increase, could you still afford it? I understand you may be in a catch 22 situation with not yet having a deposit. I think speaking to a mortgage broker will be a good starting point for you. Good luck!

Susie
@natdebtline

B-DOG_2 · 17 August 2017 at 12:08AM

Thanks Susie, yes it was a huge weight off my shoulders and I'm glad it's all finally over. yeah it's a bit of catch 22 here but I guess I may have to absorb the impact of higher fees etc for the first year or so (assuming I can even get a mortgage) until I can change product. I earn a decent living and have 0 outgoings (other than living costs) so I'm sure from an affordability point of view I should be ok. It's just finding a lender willing to give me a mortgage.
Can anybody recommend a financial advisor that may be able to help me out??Im sure I've seen advisors on these forums that specialise in these kind of things.
Thanks again Susie for the advice
B

Silence101 · 17 August 2017 at 6:22AM

I don't know anything about bankruptcy, but as you have no outgoings could you not spend a year or two saving up? My husband is going to be 35 and we've just been offered a 35 year mortgage so even if you apply in a year or two you may still be offered a 25 year mortgage, and even 5% deposit will give you more options.

B-DOG_2 · 27 June 2018 at 9:01PM

Hi all, bit of an update after over 10 months.
I!!!8217;m now nearly 2 years on after completing my Iva and have managed to get a small deposit together. I know there are some financial experts on here and plenty of people with experience so I!!!8217;m after a bit of advice though please before trying to find a mortgage if you don!!!8217;t mind.
Couple of points
1) My credit rating is now fair and I have had no probs getting credit for smaller things.
2) All Iva creditors are off my credit report

My question is, should I persue a high street mortgage or do I not stand a chance? I know there are specialist lenders who deal with people like myself but with higher interest. I don!!!8217;t want to go straight to a higher interest product when I could have potentially got a better deal elsewhere.
I was actually told by an independent mortgage advisor that when applying for a mortgage, the question !!!8220;have you EVER been in an IVA etc?!!!8221; will always be asked. He also told me that if it isn!!!8217;t on my credit report any more then I should say no because putting Yes would probably rule me out with the majority of lenders regardless how long ago it was.
As you can see, I!!!8217;m at a bit of a cross roads here and unsure what to do for the best.
Thanks in advance
B

[Deleted User] · 27 June 2018 at 9:25PM

Be very careful about following advice to commit application fraud. Once caught, you'll be looked through the 'for rent' ads for the rest of your life.

foxy-stoat · 28 June 2018 at 8:49AM

1. Stay off the High Street as computer will say no.
2. Use a broker who has placed an ex-iva person within the last 6-12 months.
3. Dont lie on the application form.
4. Save for deposit. 10-15% minimum if you can get to 25% then you will be offered high street rates.
5. You do not want a 100% mortgage - even a 95% ones would not be very comfortable as only a small drop in house prices would put you into negative equity, no problem if you never want to sell but to be honest anything can happen in live.

Good luck and well done for completing the IVA.

National_Debtline · 28 June 2018 at 5:14PM

Hi again B-DOG

Thanks for the update and great to hear you're getting a deposit together. The Money Advice Service recommend 3 websites to search for a mortgage broker. You'll find the details here https://www.moneyadviceservice.org.uk/en/articles/choosing-a-mortgage-shop-around-or-get-advice, look under the section 'Finding a mortgage adviser'.

Best of luck with it all

Susie
@natdebtline

ACG · 5 July 2018 at 9:40PM

Some lenders do allow you to answer the bankruptcy/IVA question as no if you have been discharged for 6 years.

But not all of them. You need to know what you are doing there otherwise you could find yourself being accused of Mortgage fraud.

Speak to a broker with experience in adverse, get your credit reports at the ready. There is potential for high street but options will be very limited and will be subject to scorecard (which is different to the score on your credit reports).

Mortgage options

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