Will credit problems prohibit a new mortgage?

Posted on 7 February 2010 by muppet


My finances are a mess due to a number of factors- but mainly stupidity. I have a DMP with cccs and two ccj. My salary is in excess of £46,500 and my husbands is 44,000. We have a mortgage with a mainstream building society, a fixed rate and have never misssed a payment and a secured loan with first plus which is also up to date. I would want to sell our current home as we are spending £1400 a month on mortgage re-payments and I need to free up money to clear my debts. My husband has never missed any credit card payments but is linked to me finacially. If we sold with our income and secure employment would one or both of us be able to secure a mortgage to enable us to downsize for around £80,000. We have approx £40,000 equity


I don't think you will find there will be any difference between applying in joint names or in your husband's sole name.  As you  state you are linked financially and any credit search on your husband will reveal the details under your name.

This needn't exclude you from being able to secure a new mortgage.  Whilst the majority rely on an automated credit score, there are still a handful of lenders who manually underwrite each application they receive and these are willing to look at the whole case presented to them.  Yes your poor credit will count against you, but you have maintained the mortgage and secured loan repayments, your incomes adequately cover the loan size you are looking for, your financial position will be improved once you have downsized and there is a good deposit available.

I note that you have a fixed rate at the moment and you will need to be check what early repayment charges will apply if you redeem the mortgage.  It might be that you would be better to wait until the fixed rate period comes to an end.

I strongly suggest that armed with a copy of your credit report, you speak to a good independent mortgage adviser about your plans.


Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

You are currently offline. Some pages or content may fail to load.