mortgages.........

[Bedhead1080]

Hi everyone

So me and my partner are currently living at my parents trying to save for a house. We have a deposit of around £20k (some savings and some is inheritance) and from speaking with a few people at work (work for a estate agent) and some affordability calculators, we should be able to borrow around £165k. We checked with Santander, NatWest, Virgin and The West Brom all of which said roughly the same figure in our current situation. We are hoping to look around for the next 6 months as the market isn’t great at the moment where we are hoping to buy and then if we find somewhere, apply in February/March 2019. This period also gives us time to pay off remaining credit card balances etc.

However, I’m now a bit concerned as one of our clients at work had their application declined today. The reason was that they had a payday loan 2 years ago (all paid off in time etc, the lender just didn’t like the fact they took out a payday loan.... a whole 2 years ago!) I realise lenders have different criteria’s etc some are stricter than others but this seems a bit OTT?

Me and my partner don’t have the best credit history: several payday loans (all paid off though) credit cards, bank loans, store cards, high interest credit cards.... the works. However most of it is paid off and the last of it will be paid come December. We have no CCJs or IVAs etc, we have kept up to date with payments bar 2x missed payments on my new look store card amounting to roughly £32 within the last 8 months. We are careful with money now, we don’t do anything extravagant apart from the occasional night out, cinema trip or meal etc.

I guess I just wanted to see what other people’s experiences are with mortgage applications and getting approved. I realise we should go to a mortgage broker which we plan to do, I just wanted to see what the experiences are of people on here. And if any of you have been approved for a decent mortgage with poor credit history? Any advice would be greatly received. X

Some lenders automatically decline with any history of payday loans because they think it shows bad money management. Adverse credit lenders do exist if you need one, but you will pay a lot more in interest. Your broker will advise which high street lenders are most 'forgiving' in terms of previous financial dealings.
My DH has some unfavourable financial history and still had a couple of defaults on his credit file when we applied. Our broker placed us with Halifax on a decent rate, so there are the right places to be found, you just need the expertise of a broker to do so properly without putting yourself at risk of unecessary declines.

Agree re. Halifax, they seem to be one of the most relaxed lenders, eg they don't insist on 3 months payslips, just a contract of employment, and will consider payday loans as long as they're cleared off.

You need a broker, who can access the whole market and know who will accept your borrowing history. It will affect your credit rating more if you apply direct to a lender who would never have accepted your circumstances.

go to an independent broker who will work FOR YOU to finds lenders who will be likely to accept your circumstances, if you end up taking a mortgage they recommend, yes you pay a fee....but as they will have access to deals you don't you should still save overall..

I use London and Country as they are completely independent.