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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:

DrHolmes · 21/08/2013 13:15

Where in Scotland? I could pm you details of the guy I used he is based montrose and dundee if that's near to you?

Original poster

ALittleBitOfMagic · 21/08/2013 13:20

Dr I've pm'd you

OP posts:

Sleepyhead33 · 21/08/2013 14:58

Sorry ... I have just proved the posters on the other thread (about posters outside of England) right-oops.

Good luck with it all anyway. J

sashh · 21/08/2013 16:22

Wait 2 years and then ask the council for a swap/new place. If your children are not the same sex they can't share a bedroom (under normal circumstances in a council property)

oscarwilde · 21/08/2013 16:42

I would stay where you are (if you can't swap for a house) and save like mad. Set DD's 12th birthday as a target date for mortgage approval or council reallocation and if you can't do either by then, reassess.
Definitely look for a swap though - far more flexibility with a house especially if you get right to buy eventually.
Google Pinterest and bunkbeds for great ideas for childrens bedrooms. If you can put curtains around a built in bunk bed and have a trolley bed so your son can bunk with you occasionally so your DD can have sleepovers then it should all work out
Some fab ideas here
redesigningsarah.com/2011/08/29/bunk-beds/

mrsjay · 21/08/2013 16:46

pay the default as soon as it is paid then you can apply for a mortgage just pay it and put your plans back a while keep your flat dont move out whatever you do , I had a default on old council tax I did pay and then we managed to get a mortgage

mrsjay · 21/08/2013 16:48

and how much space does a 4 year old take up it is no big deal children sharing a room it really isn't why are you going to wait on not pay off the default ? i am not being mean just curious

Naicehampombeartrexfrootshoot · 21/08/2013 16:49

Have you looked into shared ownership? You can get them near me starting at £30,000. That's the equivalent of a deposit for a full mortgage in many areas. Also, you may find that despite the default you may be able to get a mortgage for this lower amount. Often the shared ownership people have their own lenders who are helpful about things like this.

expatinscotland · 21/08/2013 16:57

I would not private rent.

Fluffycloudland77 · 21/08/2013 17:32

We had this, I wrote a very polite email to the chief exec of the company explaining we'd had the mobile for 2 years and paid on time each month by DD and that this pro-rata payment had been outstanding but in dispute etc but was now paid and basically could they remove the black mark as they could see it was stopping us from getting a mortgage.

They removed the default off his record for us two days later.

It was the worst week of our lives waiting for it all to be sorted out though.

Chunderella · 21/08/2013 17:46

This reply has been deleted

Message withdrawn at poster's request.

mrsjay · 21/08/2013 18:06

she still wouldnt get a mortgage on the a shared ownership as the default is outstanding still,

mrsjay · 21/08/2013 18:06

fluffy our default was cleared really quickly too

Tuon · 21/08/2013 18:18

"Whether the debt is paid or not the default will be there for 6 years."

3 types of default.

Unpaid
Settled
Paid In Full

All show as a default, Paid in Full looks better and this can make a difference.
Settled is not as good, the future potential creditor can see that you settled but not what percentage, some places settle for 30%,
Unpaid. Looks shit.

Experian to find out who the debt is with, it may have been sold, the original creditor can also advise who it went to. If you can't pay in full try and settle. Shows that you tried and if you are going for a mortgage sometimes an underwriter will look and make the decision, it's not always a computer says yes or no situation. In these instances a settled in full is better than unpaid.

Original poster

ALittleBitOfMagic · 21/08/2013 19:53

We have been adviced by a debt advice service not to pay it . Because we are contesting it . If we pay it we are saying it was our fault . We don't think it was our fault .

OP posts:

Feminine · 21/08/2013 20:03

How much is it for? :)

maddening · 21/08/2013 20:05

I agree don't settle it if you don't owe it.

If you did settle it is would reflect on your credit file as a settled default so would reflect that you had paid it off.

So where are you with the contesting if this debt? How did it come about? Have you lodged your complaint? Have you got any idea of their timescales for this? (There are rules in place with the FCA for these timescales which they have to stick to - the clock starts ticking the moment they receive your letter. ) have you spoken to the financial ombudsmen? If there is any heel dragging the ombudsman are a good place to get things done.

maddening · 21/08/2013 20:05

Did your dh borrow the money?

maddening · 21/08/2013 20:09

Sorry don't know if it has changed but in my day they showed as settled for paid in full and "partial settlement" for a settlement at below the owed amount - but this was 4years ago that I worked with stuff involing the credit ref agencies so Tuom is probably more up to date than me :)

Tuon · 21/08/2013 20:26

I think it's just the names used that's changed Maddening. Although I work more customer facing with debts and we are trying to use terms that are clear and fair to the customer all the time.

From what OP said earlier it's not a borrowed amount as such but an unpaid bill with an early cancellation charge.

From my experience if the customer's been made aware through the agreement that that charge would apply then he's liable. Plus the fact it wasn't contested at the time and it was just allowed to drop into default won't help either.

When buying mobile phones I doubt it would be seen as unreasonable that every nuance of the contract wasn't covered by the store either. There's the contract to be read and agreed to plus a cooling off period of 14 days which the customer could have used in the instance that he didn't read the contract at the time of agreeing.

maddening · 21/08/2013 20:54

I would contact their complaints department, and then go straight to the ombudsmen then - I have seen complaints such as your ruled in customers favour.

key points in your favour are - you were not informed of the fee (FCA treating the customer fairly rules), you were not informed of the arrears or default.

I would imagine that they would rule either that the default is removed and full amount refunded to bring balance to nil or default removed and only interest and late/default charges refunded while the cancellation fee is to be paid by your dh - depending on whether the cancellation fee was valid.

I would stay there till the default is sorted which I would imagine you could achieve in 2-3 mths if you keep up with your complaint.

BionicEmu · 21/08/2013 22:00

When we looked at mortgages a couple of years ago we discovered that DH had a CCJ that we didn't know about (complicated situation with an old mortgage). Mortgage brokers were saying they could only try with certain lenders but the interest rate would be well over 10%.

Well, we were walking through a nearby town & happened across a C&G branch so went in. Had a lovely chat with the mortgage lady there, told her in detail about the CCJ, & she sent off our application. Underwriters called a few days later & were happy with DH's situation, so we got a mortgage agreed at 4%. And this was as the financial crisis was happening, when lending was tightening & house prices going down.

So for us, mortgage brokers were useless but the actual building society was fantastic.

maleview70 · 21/08/2013 22:15

Only in the UK would people be so against renting privately.

There are lots of advantages

All repairs are paid
You can move whenever you want
You can often rent somewhere well out of your price range if you were to buy.

Where I live I can rent a house for £800 a month that would cost me £300k to buy with a mortgage cost of well over £1300 per month.

I own so don't practice what I preach but I wouldn't rule it out.

Renting is common practice abroad.

hettienne · 21/08/2013 22:17

Renting is very different in many other countries, where tenants have greater rights and security of tenancies. The idea that a landlord can just give you a couple of months' notice to get out, or tenancies only being 6 months as standard, seems crazy to many Europeans.

hettienne · 21/08/2013 22:18

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