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Stuh88
Contributor

14 Posts

Posted - 19 August 2019 :  10:43:14  Show Profile  Reply with Quote
Hi guys,

I started my trust deed in January 2013 and it was completed in april 2016 but never received my form 7 until april 2018. The trust deed is obviously not showing on my credit file anymore. I've got a few credit cards and my credit file is looking pretty good at the moment, although i had to recently settle an old o2 bill that defaulted in 2015 and wasn't settled until 2018 but it was settled in full. O2 have refused to remove the default.

I recently had a consultation with a mortgage advisor who told me I wouldn't be considered for a mortgage because of the o2 default and the fact I hadn't been out of my trust deed for 3 years, is this correct? I was always under the impression that once it was off the credit file a mortgage wouldn't be an issue. The o2 bill had been disputed for about a year before it was eventually paid, would a notice of correction be worthwhile in this instance?

Any advice greatly appreciated. My partner has a mortgage atm and I pay it every month as we had a baby last year and she is part time so I pay the majority of bills and this shows on my bank statements.

Thank you
Stuart

Paul McDougall
Trust Deed Expert



12 Posts

Posted - 19 August 2019 :  10:55:02  Show Profile  Reply with Quote
Stuart

Mortgages can be complicated as the lender will consider a number of factors such as credit score, affordability, loan to value, age etc.

it is possible to obtain a mortgage after a trust deed but it does take time and planning however, in the short-medium term, your options may be limited and you will most likely face high-interest rates.

When you are discharged from the deed, you need to rebuild your credit report. It appears you have been doing this however there is an 02 default - is this a debt that formed part of the trust deed or incurred after?

You can increase your chances of being accepted such as rebuilding credit report, saving for a deposit, ensuring you have a good credit report.

Did you go to a mortgage advisor from a high street bank or did you speak with a mortgage broker?

High street banks tend to be less risk adverse and may reject your application straight away.

Perhaps a second opinion from a mortgage broker may be the best course of action.

From personal experience a number of clients have been able to obtain mortgages after being discharged from the process. There are lenders willing to lend.



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Edited by - Paul McDougall on 19 August 2019 14:23:44
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Kevin Mapstone
Trust Deed Expert



3777 Posts

Posted - 19 August 2019 :  18:02:44  Show Profile  Reply with Quote
I would agree with Paul - perhaps it would be a good idea to get a second opinion from a different mortgage broker. It will depend on other factors too, but the Trust Deed in itself shouldn't mean an automatic "no".

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David Tannock
Trust Deed Expert



2218 Posts

Posted - 21 August 2019 :  10:26:49  Show Profile  Reply with Quote
Hi Stuh88,

Id definitely look into speaking with a couple of independent financial advisors/mortgage brokers that work with the whole of the market and not just one or two lenders. If the mortgage advisor that you first spoke with only really works with the Halifax (for example) and they have a strict criteria then they wont know of other lenders who would consider you.

We often hear on the forum of mortgage advisors painting a really negative picture of being able to secure a mortgage and then we also hear of positive stories of people going onto secure a mortgage who are in a similar situation to you.

In the past I do know that Glasgow Credit Union will lend to some who is out of a Trust Deed for 1 year as long as they meet the rest of their lending criteria. They dont tend to focus on the credit rating / report too much. You do need to live or work in a G postcode. Capital Credit Union in Edinburgh could be the same.

If you shop around and do a little bit of work you might find you are successful.

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Stuh88
Contributor

14 Posts

Posted - 22 August 2019 :  20:33:15  Show Profile  Reply with Quote
Thanks for the responses everyone. Greatly appreciated.

So went to see a mortgage advisor on tuesday, explained my situation and left it with him. He called me today and said I'm able to get a mortgage but with a 20% deposit and a 3.2% interest rate. He advised me that if I wait until April, when I'll be 3 years discharged it may open more doors for me or lower the deposit amount.

It's something we just cant work with at the moment but I'm remaining positive that at least I'd be considered. So plenty of saving etc and hopefully next time it will be a 10% deposit.

Thanks again
Stuart
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TDA (Debt Adviser)
Trust Deed Expert



13056 Posts

Posted - 23 August 2019 :  09:04:59  Show Profile  Reply with Quote
Hi Stuh88.

I'm glad that you've received a more positive response this time.

Allowing some time to pass, and saving up a decent deposit, are two of the most important things to be doing in order to get the right mortgage in the future.

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David Tannock
Trust Deed Expert



2218 Posts

Posted - 26 August 2019 :  10:23:59  Show Profile  Reply with Quote
Hi Stuh88,

That sounds a lot more positive than a flat no from the previous advisor you spoke with. Always worth shopping around for a second and third option/opinion. I do that with most things in life and it drives my wife crazy sometimes.

As you say it now gives you hope and something to work towards.

Please let us know how you get on if/when you do secure that mortgage.

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