Has anyone successfully applied for a mortgage with bad credit/previous (settled) defaults?

[GamerLlama87]

Hi all, I wonder if anyone can give any advice or guidance. We do have an appointment booked with a financial advisor on Wednesday, I'm just feeling anxious about it and looking for any pointers and honest opinions.

So my partner and I are hoping to buy a house. We currently rent, neither of us are on a mortgage. My partner has never been on one, I was on one with my ex partner that was taken out in 2015 and the house sold in July this year. We split in 2017, my partner lived there and took 5 years to agree to sell and therefore get me off the mortgage bright side is that there were no missed payments at all on that mortgage.

For additional info, I earn £28,750 and my partner earns £18,000. We have a child and pay around £300 per month for nursery. I also get child benefit paid to me each month. The house we have our eye on is being valued this week, estimated around £80-90k (we live in a rubbish little South Wales valley town!) and we have a £10k deposit. £6k of that is mine that I have saved.

My worries are that I have defaults from several payday loans from when my ex and I split. I was working a min wage job at the time, I tried to live in the house myself but I struggled to pay the bills and so I stupidly got myself into a right situation.

All the debts are now fully settled, some went to debt collectors such as Lowell etc but have all been paid and no missed payments or defaults since early 2019.

My credit rating comes up as Fair on Clear Score, Experian and Equifax.

Are we likely to get a mortgage? Even if we had a "bad credit" mortgage with a horrible interest rate, is this likely to be accepted? I hate that I got myself into such an awful situation, I feel so anxious about it all.

Sorry for such a lengthy post but I'd really appreciate any advice. Thanks

 

[Lizz17uk]

Hi all, I wonder if anyone can give any advice or guidance. We do have an appointment booked with a financial advisor on Wednesday, I'm just feeling anxious about it and looking for any pointers and honest opinions.

So my partner and I are hoping to buy a house. We currently rent, neither of us are on a mortgage. My partner has never been on one, I was on one with my ex partner that was taken out in 2015 and the house sold in July this year. We split in 2017, my partner lived there and took 5 years to agree to sell and therefore get me off the mortgage bright side is that there were no missed payments at all on that mortgage.

For additional info, I earn £28,750 and my partner earns £18,000. We have a child and pay around £300 per month for nursery. I also get child benefit paid to me each month. The house we have our eye on is being valued this week, estimated around £80-90k (we live in a rubbish little South Wales valley town!) and we have a £10k deposit. £6k of that is mine that I have saved.

My worries are that I have defaults from several payday loans from when my ex and I split. I was working a min wage job at the time, I tried to live in the house myself but I struggled to pay the bills and so I stupidly got myself into a right situation.

All the debts are now fully settled, some went to debt collectors such as Lowell etc but have all been paid and no missed payments or defaults since early 2019.

My credit rating comes up as Fair on Clear Score, Experian and Equifax.

Are we likely to get a mortgage? Even if we had a "bad credit" mortgage with a horrible interest rate, is this likely to be accepted? I hate that I got myself into such an awful situation, I feel so anxious about it all.

Sorry for such a lengthy post but I'd really appreciate any advice. Thanks

I have managed to get a mortgage with my partner l through a specialist lender (using a mortgage brother) in the last six months, before the rates went sky high, now it’s a little more tricky although I am almost, as of January, two years post my last missed payment.

I got myself in a lot of debt with loans and credit cards which I was managing ok for a good few years but I got to the point about 3 years ago whereby I just couldn’t manage it all and started to miss payments and things were sent to debt collection companies to try and reclaim the funds. I took out a DMP in the end through payplan which was amazing, they sorted everything for me and I was able to get the payments under control. I paid that off in July with the help of my partner and now have no debt at all. My credit score was awful though, about 535, and it was only that good because I do rent and had always managed to keep up with all my other payments, rent, bills, mobile etc. My partner is already a home owner and with a perfect credit score but even trying to get a joint mortgage, my credit history massively affects what we can borrow and the rate. We did initially have a mortgage in principle at about 6%, which now seems incredible, after the rates went up it doubled and just wasn’t dooable for us. My partner can still get the mortgage with a friend of ours as a guarantor, but for us it was just too expensive. We are hoping though that now I’m 2 years post my last default, we will now be able to get accepted again just the two of us, apparently the 2 year thing is very important.

I don’t want to give advice, as I’m not qualified in anyway but we live down south so are looking at properties far more expensive than in Wales, if you’re saying you had your last default in 2019 and things have been fine since, you earn decent money and have a good deposit, I think you ll get something. I don’t want to get your hopes up but I reckon you’re in with a good shot! My advice is to not worry about the appt, because it’s best to find out what the situation is and if it is bad news, the broker will advise you how to try and improve things and give you all the possible options. It sounds like you are in a much better position than me and I managed to get accepted!

Also re the credit history, these vary agency to agency and I had issues getting an accurate one, I was advised to register for check my file, you have to pay but then you get access to literally everything, it combines several companies and will give you a really accurate credit score and report, you can cancel once you have the information any time you like so you aren’t tied in but might be worth having a look at that to see if it ties in with the other credit scores you’ve seen

Honestly though don’t worry, I felt the same when we first approached the advisor as I knew it would be me causing the problems but it turns out it was and still is possible and there are plenty of specialist lenders out there that will take on people with bad credit, so I’m sure you will be able to find something! Fingers crossed!!!!

 

[XNosey-parkerX]

I had a number of defaults and had used pay day loans and still managed to get a mortgage. However, my partner had a large amount of equity and we had to go with a sub prime lender which had very high interest rates, but after a couple of years we have moved to a high street lender.

Definitely get a broker involved, they will be worth every penny (about £400 for us).