I cannot say for certain but the very fact that the default is so old ad will shortly drop off combined with the fact that you are borrowing only around 40% of the property value in my mind should mean that you should have clear run.

As I said in the last post, while the default is a major issue with anyones credit it is not fully dependant on the default for you to pass or decline. If you have a past record in the last couple of years of misssed payments or constantly living in overdraft or paying bank charges then this type of thing can easily sway a mortgage lender too. If you have been good with your credit and don't incur bank charges and repaid everthing on time for the last couple of years then I would think that you will have no problem.

Looking at the mortgage market you may still have a few problems with some of the lenders. The best rate lenders such as Ulster Bank and Northern Bank do not accept any past adverse credit and Santander have recently gone the same way with adverse credit. Your best bet is to go and speak to a local mortgage broker and get their view on who you can approach, there will still be plenty of choice and the likelihood is that you will get a fee free rate at les than 4%.

Good Luck

Hiya Zeb,

Thanks for the swift and thorough response. Brilliant. I have just double checked my credit file and notice that the default will become 6 years old in early August of this year. Do you believe that I should wait until then so that the default record is off my file?

Hi Runaychris,

I am a mortgage broker based in Northern Ireland and I can tell you that you have many choices and most of what you are saying is unlikely to happen anymore if your credit is in reasonable shape and you have had no further problems since the default 5 years ago.

As it happens I am dealing with a first time buyer at present and they have a 5 year old default and I have got them accepted at 85% borrowig so a remortgage of 41% or less is not going to be much of a problem if you have been good with your credit and mortgage over the last couple of years

Ascenden will not give you another product purely and simply on the basis that they no longer lend money and have gone out of business as a mortgage lender.

With a 5 year old deault it may raise an eyebrow with some lenders but because the risk they are taking on is very low I doubt that many lenders will say no (Ulster Bank and Northern Bank will say no though). If you approach any mortgage broker they will be able to show you the whole market as it stands and move you towards a lender that will be sympathetic towards your past histoy and should be able to find you a product around 3%-3.5%. The cost of the mortgage will of course depend on the term of repayment but an interest only mortgage at these rates would be around £110 per month

The fact that you are looking to move towards repayment instead of interest only will give the lenders confidence in your application too.

So far as fees payable upfront. There are more and more lenders that are asking for a "booking fee" which is often £99 - £199 upfront fee but as your mortgage is so low I would be looking for a totally fee free mortgage so there would be no arrangement fee, no booking fee, no valuation fee, no legal fees to set up the new mortgage. You will pay a slighty higher interest rate for accessing such products but as your mortgage balance is quite low it will have a far lesser affect on it than taking a lower rate and a fee of say £999.

Speak to a mortgage broker (not a banks mortgage monkey) and he can give you a list of such products. I would even go so far as to say that the broker should do this without a broker fee too or at least at a low cost broker fee. If you offer to let the broker review your mortgage related insurances he will most likely let you pay no fee to him as he could earn quite a good fee on commission from insurances

Good Luck!

Good morning,

Currently have interest only mortgage of 41,000 on property valued at 100,000 in Northern Ireland. This mortgage is with Acenden who will not allow me to change to an interest and repayment product. This product was obtained whilst I was sub prime but I have now managed to get everything in order, although a 5 year old default still remains on my file. I have £5,000 cash to put towards the balance. I am keen to fix payments for as long as possible and avoid huge up front fees and finally start paying off the capital as soon as possible. I am also keen to avoid paying an upfront application fee to be told that my credit score is not suitable. Any guidance greatly appreciated. Thanks a lot.