Will this stop me getting a mortgage?

[HeartRainbow87]

Around 4 years ago, I was in a financially difficult position living alone for the first time. I went into arrears with a lot of my bills, was having takeaways nice clothes etc and just not sensible. I ended up with 5 defaults, but fortunately no CCJ’s.

Since then I’ve really turned my life around. Moved somewhere cheaper, on a better wage and manage my money. All defaults are settled, I check my score regularly. I have three remaining which should be removed in the next two years.

Now, I always make sure to pay my bills on the 1st month and I never miss payments. However with my remaining money, I usually take it out as cash and split it into 4. I find this the easiest way to manage my money, I don’t go overdrawn or anything and I’m less impulsive with cash than I would be using contactless for example.

I’ve been saving for a deposit for a house and I should finish saving in 2024, when the final defaults are removed. However my friend said that I won’t get a mortgage as my bank statements will show no transactions? Despite all my bills being on there and paid and one large cash withdrawal to cover the 4 weeks.

Is this true? All my family bought houses long before there was these processes and google isn’t coming up with anything.

I think it will be fine. You have a trail to show you can and are paying all your bills and by then you won’t have any defaults on your credit report.

I think you’re probably fine, but if you want to know for certain, get an appointment with a mortgage broker or adviser, usually it’s free as they work on commission. Or, any bank will do a free mortgage meeting.

Worst case scenario is probably that they ask for someone to be your guarantor, but I doubt that willbe necessary.

Why don't you contact a mortgage broker and talk it through with them? London and country mortgages are free and really helpful. Why not give them a call and ask?

I know you have to give 3-6 months bank statements to the bank when you apply and they might want to see a few more transactions.

Since you're not applying yet, I think this is something to think about closer to the time. I am a cash spender too and it helps me save so much!

Have you checked this too? www.moneysavingexpert.com/loans/credit-rating-credit-score/

Good luck and congrats in advance on your future home!

Your friend is talking bollocks. End of.

What you can do to boost a credit score is show credit being used and repaid. A mobile phone contract would do this, or a credit card that you use AND PAY OFF IN FULL EACH MONTH

If the last point is too much temptation, do not do that.

I was advised that a lot of cash withdrawals could hinder mortgage applications as your affordability factor is lower as the lender cannot see or predict your spending habits.

Having said that a family friend was told to take her childcare payments out in cash so it appeared their monthly fixed expenditure was lower.

So I'm not really sure but I can understand where your friend is coming from.