Can anyone explain to me how defaults work?

[CherryGarcia23]

My husband isn't being honest with me about a few things, he is explaining it away as 'I don't understand'.

A few years ago, DH took out a loan to start a business. He never did anything with proposed business and whittled the loan money away.

2 years ago, we went for a mortgage, the broker came back saying DH had too many credit issues, one of those issues being a £3.5k default on the loan. DH said he knew nothing about any default or even any missed payments.

I paid the default out of my own savings which was at around £4k at the point of payment.

Fast forward to now and I want to get a mortgage. Last year DH put his loan on a 12 month payment plan, and has missed a number of payments but he tells me this doesn't matter, he'll make up the shortfall the following month.

I have worked out that he is approximately £7,000 behind on his original loan agreement with this payment plan in place.

Am I right in thinking that this will have a negative effect on his credit rating and there will be ZERO chance of us obtaining a mortgage whilst he is showing he can not meet agreed loan payments?

He tells me that this payment plan won't show on his credit file, but also refuses to sit and go through his credit file together. I know of 1 loan and 2 credit cards on repayment plans with numerous missed payments.

Am I right in thinking that any type of payment plan outside of the original loan agreement will be viewed negative by any mortgage lender?

Any payments that are more than 30 days late will show on his credit file. A mark is noted again at 60 days, 90 and 120. One payment at 30 days is fine and can usually be explained away, but anything more and he's got no chance of getting a mortgage for several years. Even the last default will show for six years after settlement.
Do not buy a house with this man, or even with him living in it and just in your name. He clearly has no control over his money and is in denial about it. It will not end well for you.

Shit

your husband is diabolical with money

Do not get a mortgage with this man. I’d be surprised if any high street lender touched him anyway with serial defaults and issues

I would advise do not buy a place with him. You cant go into a financial agreement without openness and honesty.

Plus if a financial agreement goes into arrears. whether agreed or not, it will show on your credit file. And if its upto 3 months in arrears, they have the option to record it as a default.

Thanks for the replies.
I thought he was pulling a fast one, I'd be so disappointed to get all excited about buying a house, just for it not to happen again. He has let me down alot in the past.

Flipping heck.

This marriage sounds rotten to the core and you’re about to buy a house with him

You are about to buy a property OP with someone that you “thought was pulling a fast one”

OP, why are you considering buying a property with someone who has "let you down a lot" and has shown themselves to be completely irresponsible with money? Even if you were able to get a mortgage, this is a terrible idea.

He’s massively trying to brush this under the carpet as if it’s nothing but these are some serious issues with money I’m afraid. I doubt he would be able to mortgage, a default is one thing but behaviours is another and too many missed or late payments is just as damaging.

Yes his credit will be negatively impacted.

My exh was financially abusive. My credit score was quite good. When I left and was getting a mortgage m, the mortgage advisor could even see that our mortgage payments and had been a couple of days late on a couple of occasions. Days late. Didn’t matter that it was caught up on.

Take it from someone who did buy a house and build a life with a man like this. Don’t do it. What he is doing is a form of financial abuse. He is gaslighting you. He knows you won’t be able to get a house.

Untangling myself from exh was a really long process. For a good year I still got letters for things where debt companies decided I was jointly liable for his debts. It was so stressful getting all sorted out

A default will stay on your credit file for 6 years. After that it won't show, even if you are still paying the loan off. Having a default makes it nigh on impossible to get any credit from mainstream lenders. You might get it from specialists, but it will be at a very high interest rate.

I would suggest your DH talks to Stepchange or similar and gets some advice on dealing with debt and not getting into any more before even thinking about getting a mortgage.

His credit rating will be shot. Have you checked yours? As pp said, it's a form of financial abuse. It is very destabilising. My exH was exactly like this. I lent him over £70k from an inheritance to clear his debts (personal and business). He racked them all up again.

After we split, he cashed in his pension fund and frittered it away. I had searches for loans in my name on my credit file (definitely not instigated by me as dob was wrong). I also had letters from debt collectors addressed to him arrive at my parents' house and bailiffs turn up too. This was after the FMH was sold. The only financial product we had had in common was the mortgage. I had to write to all the credit agencies and make sure that the financial link was severed.