Get a mortgage now or wait?

Hi all,

I was made bankrupt back in 2013 due to a small number of loans and credit cards. We had to sell our house as a result and have been renting ever since.

As we pay an extortionate £1100 a month in rent (standard for where we live) we would love to own again as soon as possible. We have £20,000 deposit and according to Halifax and nationwide we can afford up to £218000. We have 3 credit cards between us (cap one, Barclays and marbles) which we have been using to up our credit score. We have £2500 (of £4100 limit) between them all but we can pay this off before application if needed. We have found a small flat for £190000 and were wondering if we should take a chance and try and get a mortgage now, or wait another 6 months. Our credit score is still horrendous but I know that doesn't mean much - more importantly salary and affordability?

Also, we used to have a mortgage with Nationwide for 7 years and never missed a payment. Would this mean that nationwide, for example, might take that into consideration?

TIA

Comments

  • CarolynRach
    CarolynRach Posts: 203
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    We went to First Mortgage Advice for free advice on when the best time to buy was - we were also unsure whether to save up for longer or get on the property ladder as quickly as we could. FYI, the name is confusing - It doesn't need to be your first mortgage to get advice.
  • kittykat31
    kittykat31 Posts: 29 Forumite
    Thanks for the advice Carolyn. I'll take a look at them. Just out of interest, what did you decide to do in the end?
  • I would contact decent mortgage broker. They guided me through everything as I was rejected by my bank that I have my current account and got me approved with a different lender. I didn't realise the amount different option available on the market, as your bank won't tell you what their competitors offer. I definatlyspeak to a mortgage broker so you can compare your bank offers to the rest of the market.
  • mwarby
    mwarby Posts: 2,048
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    At ~6 years post bankruptcy and at 90 or less LTV there should be a few options. A broker would be the safest and less stressful route. I got a mortgage with similar credit issues last year through a broker(in my case Skipton BS). The key factors IMHO are affordability (i was looking at around half what the affordability calculators thought) and LTV

    You may get lucky going it alone, Nationwide say in their criteria (which is for brokers/intermediaries not joe public like me, but comes up on google), that they will consider after 3 years post discharge. However just because they say that, doesn't mean they will offer. One failed application is IMHO unlikely to ruin your chances elsewhere but several might makes things more difficult
  • ACG
    ACG Posts: 23,677
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    I would be relatively confident there will be options out there for you now.

    I always say ignore the score as it means nothing, we go through your credit file line by line to determine likely success - but the score can be a decent indication.

    There will be lenders from what you have said who would consider you regardless of score, the rates may be a little higher than Halifax/Nationwide, but we would be talking maybe 3%-3.5% so nothing significantly bad (my first mortgage with no bad credit and 15% deposit 6-7 years ago was over 3%!).

    A good experienced broker will be able to help.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • to echo everyone in this thread, you have to research your options and find a mortgage broker that you can just and make sure you really understand every aspect of the mortgage... with rates as they are at the moment you can get some attractive options... depending on your situation (i'm not a mortgage adviser :) )
  • OP hasn't been back for four months.....
    Mortgage started 2020, aiming to clear it in 2026.
  • Thanks for the advice.
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