Confused

Mitch3000
Mitch3000 Posts: 1 Newbie
in Mortgages & endowments
My self and my husband earn a good salary between us.
However we have debts from the past I would say no more than 3000 pound but we have ignored them.
We now want to buy our house we have a deposit of 9000 and a combined income of 62000. We have rented for about 9 years never missed a payment we feel this should be considered in our mortgage application. Also. Should we take the 3000 out of our deposit and pay of the debt out right? We have a good income now but our pasts are crippling us. HELP

Comments

  • Edi81
    Edi81 Posts: 1,444 Forumite
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    What do your three credit files say?
    Are the historic debts in there? Are they defaults?
  • csgohan4
    csgohan4 Posts: 10,587 Forumite
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    that debt will affect your affordability depending on the house price you want to aim for
    "It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"

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  • ACG
    ACG Posts: 23,719 Forumite
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    When you say you have ignored them do you mean they are in arrears or you have just paid the minimum payment and not made a conscious effort to clear them?

    If they are not in arrears and you have just been paying the minimum payments, it wont matter. It may reduce how much you can lend but £3k on £60k income is nothing to worry about, you would still be looking at around 4.5x income.

    If they are in arrears/default that will matter and will probably mean you need to look at more specialist lenders. The problem here is that depending on the age of the defaults you will probably need a larger deposit.

    For the time being, I would say keep your deposit as it is, the higher your deposit, the more likely you are to be accepted (in general).
    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.
  • Exodi
    Exodi Posts: 2,861 Forumite
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    Much more detail about these debts is needed. If these are defaulted, a lender will certainly question why you're on a good income but have not paid these. If these are 'historic' debts it's less relevant.

    If you're on £62,000, assuming you have a fair amount of disposable income and have not had an offer accepted on a house yet, I would personally just clear the debts over the next couple of months and then apply with a clean slate.
    Know what you don't
  • phillw
    phillw Posts: 5,593 Forumite
    First Anniversary Name Dropper First Post
    Mitch3000 wrote: »
    However we have debts from the past I would say no more than 3000 pound but we have ignored them.

    You need to know exactly how much they are, so stop ignoring them.
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