Allys

In another post in February 2009, you mentioned your fixed rate was coming up for renewal and you needed to sort out a new deal. Also that your girlfriend was not aware of your debts. Have you now sold the property and have since told your gilfriend about the debts?

If you have not sold the property, its just changing mortgage, may I suggest that you advise your girlfriend about the overdraft and loan. Then approach the existing mortgage company with all the information and negotiate the best deal that you can. The chances of getting a good new deal with another company are not good.

Honesty is always the best policy for both personal and business relationships. If you hide information, this will just lead to tears and tear you apart. Talking to the debt advisor at Citizens advice may give more insight into your current position.

huckster

thanks for your advice huckster

yeah prob will see an advisor

just wanting advice to see if we will get another mortgage

cheers

Allys

You should really see a mortgage/financial adviser who will let you know whether paying off the overdraft would assist with a mortgage application. I would think that any improvement to a credit rating is not instant, you would have to wait until you have shown you are in control of your finances. As for the loan I suppose it would depend on the type of loan and the details. Any mortgage company would ask for details of the loan.

There was an article (link below) in the times recently, which you may find is worth a read. Do a search on google and you will find other articles on Mortgage and comments in the various forums.

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6695319.ece

huckster

thanks for the advice

not really the advice I was wanting to hear.

do you know if I payed my overdraft off would that help as I have not missed a payment on my loan?

Allys

In this situation I think you need to sit down with a financial advisor. There will be alot of questions and issues to think about.

Has the house been sold and the £20k banked? If so you may wish to get some advice about whether paying off any of your debts will improve your credit rating to make any difference with a new Mortgage application.

Who is the main earner that would be first name applicant on the Mortgage? If this is your girlfriend could she apply for the Mortgage in her name only? If this is possible, perhaps once you have cleared your debts and improved your credit score, you can be added to the Mortgage at a later date. From what I understand, however, if companies are lending only 3.5X salary, she would need to be on atleast £40k, to afford a £150k property in her sole name.

If you are to be party to the Mortgage I would think that your debts and credit score will count against you. This is because these debts may cause you difficulty in being able to make repayments and the companies you owe money to, could take proceedings against you. Therefore I doubt you can get a mortgage in your current circumstance, as from what I have read others in a better position are being turned down, as lenders are being very picky.

If I were in your position I would use the money to pay off the debts, provided there was not any penalty for early repayment. I would then rent for awhile, rebuild my credit rating by being careful for a few years and then look at getting back on the housing ladder. If you invest any money you have left over, you may build up a reasonable deposit again.This will be a much better way, than paying interest/fees on debts and hassle from bank/loan companies. If you are thinking house prices have bottomed out and now is the time to buy again, I think it is too early to tell. Getting credit is difficult and this will continue for awhile. If a were a betting man, I would put money on, that house prices will not start to increase by any significant amount until after the next general election June 2010.

huckster

hi try and keep it short here, just sold our first house house that we had for four years and will have a 20000 deposit to put down on next but heres the story,My girlfriend has an excellent credit rating but I have not, I have a 4000 overdraft and up to max and and 4000 grand left to pay on a 8000 loan but I am starting to think that we might not get the mortage we would like for another house, we have seen a house for 150000 and with 20000 deposit to put down, I am thinking that we will not get that for a mortgage can anyone give us some advice that mayb in the know about these things and let us know if this will effect our chances of getting a house for this price? thanks any advice will do in regards to my situation