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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

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Original poster

WWYD if you can't get a mortgage ?

78 replies

ALittleBitOfMagic · 21/08/2013 10:19

DH and I live in a 2 bedroom council flat . We have dd who is 8 and ds who is 9mo . We planned to move after Christmas but found out dh has an old default on his credit report . So now we can't get a mortgage . So our options are :

stay here another 4 years until the the default drops off . This would mean we would have a 12yo sharing a room with her 4yo brother .

private rent . Our rent would likely double which means no way of saving for deposit and other buying costs

try to get a house swap but we only qualify for a 2 bed so would mean going through all the house move hassle and they would still have to share a room .

Dh wants to private rent but I want to try and get a swap . He says there's no point in swapping to another 2 bed but I think if we get a 2 bed house then it will at least be less cramped and we won't be living in a hoarders paradise . I don't want to spend loads of money on rent on a house we don't/will never own . AIBU ? Should I just private rent and get the dcs their space ? WWYD in this situation ?

OP posts:

Feminine · 21/08/2013 10:21

Maybe try to make good on the default?

Work with the creditor perhaps?

I mean that nicely, they may come to an agreement and amend your report accordingly?

might work out faster?

LeaveTheBastid · 21/08/2013 10:22

Can you contact the company the default is with and try and sort something out, and then get it removed from your credit report?

Failing that, I'd swap to a 2 bed house.

dirtyface · 21/08/2013 10:22

i'd stay put. i know it will be cramped and difficult but if you move into priv rented it will be much harder to keep saving

i don't know much about mortgages tbh but it sounds really harsh that an old default is stopping you getting one

(am also watching this thread as we want to buy soon too but both have had bad credit in the past)

hopefully someone wiser will be along soon

ViviPru · 21/08/2013 10:22

DH and I are both self employed and getting a mortgage is complicated and out of reach for the time being.

So we're renting privately. I don't see it as spending loads of money on a house we'll never own. It is a sensible solution under the circumstances. We have a lovely, affordable home in a nice area and no maintenance concerns.

Feminine · 21/08/2013 10:23

Oh, and I would never go in to private rent when you have the gold version of a tenancy agreement!

Feminine · 21/08/2013 10:25

Its never a waste of time/money private renting though. If that is your only choice.

You have to have a roof over your head.

Its very difficult to buy for the average family.

MrsGarlic · 21/08/2013 10:30

Are you SURE you can't get a mortgage at all? It's worth checking with a mortgage broker. We assumed we couldn't get one (for a different reason) but it turned out we could and we are now very happily living in the flat we bought

Original poster

ALittleBitOfMagic · 21/08/2013 10:31

We have spoken to debt advisers and have put a notice of correction on his credit file but we have been told that the chances of them removing it are very slim . Because to have it removed they would need to admit he doesn't owe them the money . So that along with a couple of late payments on my file means that mortgage companies will never come near us

OP posts:

Original poster

ALittleBitOfMagic · 21/08/2013 10:32

Mrsgarlic we saw a broker and he told us to come back when the default was "sorted"

OP posts:

Feminine · 21/08/2013 10:33

Is the debt large? :)

If you pay it off, they have to remove it.

ILetHimKeep20Quid · 21/08/2013 10:33

Go see a different broker.

BrokenSunglasses · 21/08/2013 10:34

I'd stay put and save like crazy. Then wait for the default to be removed from the credit rating and have as much as possible ready for a deposit.

Private renting can be very unstable, and while it would be better for you in the short term, you have to look longer term when you have children. If you're spending all your money on rent you will be stuck in that position forever, whereas if you make sacrifices now, you will have the possibility of improving the situation for the future.

There would be no harm in looking for a swap, if something good comes up then you can go for it, but if not, then you won't be wasting money.

Original poster

ALittleBitOfMagic · 21/08/2013 10:36

Feminine I've researched this quite a lot and paying it would be worse . And they don't have to remove it because no matter if or when he pays it it's still defaulted

OP posts:

ShellyBoobs · 21/08/2013 10:38

We planned to move after Christmas but found out dh has an old default on his credit report

Is it actually an 'old' default, or does he still owe them money?

ShadeofViolet · 21/08/2013 10:41

Is the default settled or outstanding?

Gobbolinothewitchscat · 21/08/2013 10:41

The lender dies not have to remove the default if its paid. It's simply marked as a "satisfied" default. Marginally better but still fucks your credit rating.

Your only hope is to try and negotiate with the lender and see if they will remove it if you pay in full. However, they are unlikely to do this as (from their perspective) it is negating the truth. To have a completely clear record, you would need to also negotiate that they removed every late payment which led to the default too - again, they're are very unlikely to do this

If it's a credit card default, try and check whether they've served it correctly in terms of the consumer credit act. Do a data protection act request and check (there's stuff online at money saving expert re this). If its not been served correctly, you can argue the toss there. Also, check if an element of unfair late fees have been added on to the sum - again, you can try and challenge on that basis

froubylou · 21/08/2013 10:41

Have you spoken to local HA and the council? I did think that as you have 2 DC of different sexes and your eldest is over 10 then it wouldn't be appropriate for them to share a room from that point onwards?

Feminine · 21/08/2013 10:44

I have a situation.

just out of curiosity I decided to check my file recently. I don't have any defaults. Well I thought I didn't...

Orange had stuck a crazy 4 missed payments on my mobile account that I take care of with DD.

so, I called them long annoying story nobody there could find any evidence ...they didn't call. write or make any contact. They didn't even try to 'help' themselves to the money through my regular set ups.

Well finally they found this £30 I was owing. I still don't know what it was, nor did they?

I've paid it to clear my account. Next moth it has to be removed and they will report this info to all the credit agencies...apparently

Good luck.

ShellyBoobs · 21/08/2013 10:44

X-posted.

I'm just curious how you can have 'found out' that he has a default. Surely he must have known he owed money?

I know I'm not being helpful, but I'm wondering if the length of time the debt has been outstanding is part of the issue?

CecilyP · 21/08/2013 10:48

Would all mortgage lenders be the same? When we bought our house, we couldn't get a mortgage at first because of a small unpaid catalogue debt. (We had previously had a debt repayment plan which we had cleared but this catalogue never sent us any paperwork to enable us to add them to the plan). We found out what the problem was, paid it off, and the mortgage then went through without delay.

If you stay renting, are you sure you wouldn't qualify for a 3 bed if you went for a house swap? Or even if you went on your council's transfer list? I know different councils have different rules, but here you would definitely qualify for a 3 bed. I assume you are paying full rent, but even under the new 'bedroom tax' couples with 2 opposite sex children won't lose any housing benefit once the older child is 10.

If there is definitely no chance of 3 bedrooom, I think going for a 2 bed house might be a good idea. Also bear in mind some 2 beds are bigger than others which you might be able to investigate. I have a 3 bed that is exactly the same size as my friend's 2 bed on the older part of our estate. One of her bedrooms is enormous and could be arranged to suit either 2 very different children sharing or a couple sharing with a child.

Private rent would be my last resort in your situation. By all means have a look at what is available but you could be paying a lot more rent with far less security and that could eat into your potential deposit for when you buy.

hettienne · 21/08/2013 10:53

I think you would be able to swap to a 3 bed (if you can find one!) - certainly once your DD is 10 you should be able to go back on the housing list anyway.

When we were looking at swapping from our 2 bed to a 3 bed, even though we only qualified for 2 beds we were told you are allowed to swap to somewhere with 1 spare room.

mirai · 21/08/2013 10:53

This reply has been deleted

Message withdrawn at poster's request.

hettienne · 21/08/2013 10:55

The last thing I would do is go into private rented btw - try to swap, or at least sit tight, put a sofa bed in the living room for you and give the children a bedroom each while you save up. If you have buying a house as your goal, then 4 years isn't so long.

FruitSaladIsNotPudding · 21/08/2013 11:01

Don't go into private rented. You'll have no security, less privacy and won't be able to get another council tenancy. Wait it out or go for a house swap - the room sharing doesn't sound too bad.

We were renting privately until recently and I HATED it - expensive, frequent inspections, and then in the end the LL sold up, despite having told us it would be a long term tenancy.

Original poster

ALittleBitOfMagic · 21/08/2013 11:03

Marai seriously that is not the way it works ! Whether the debt is paid or not the default will be there for 6 years. And we are not "not bothered" to pay it back ! We didn't know about it because not one letter ever arrived in the post about it ! We found out because we joined experian .

It was an old contract mobile phone that was cancelled or was meant to be anyway and they tried to keep taking payments so the debt racked up and after a few months went into default .

This is where mn seriously fucking gets my goat ! I'm not asking for advice on the default . i know exactly what to do about the default

What I'm asking for advice on is , if the company won't remove the default , whether we should stay put or private rent . Yet here is another thread where the wrong issue is being discussed .

Sorry about the rant it just bloody annoys me !

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