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#471163 Hi,

I am new to this, so sorry if I am asking a question that has been answered many times already.

My current credit score is fairly good - 792 but my mortgage application was declined due to defaults betn. 2008-2011. What are my options to get mortgage sorted?

I am willing to pay the defaults but how long aft paying off the debt, can I expect to be successful in getting mortgage? Any time line?

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#471173 Hi and welcome

Firstly please have a read of this thread on Credit Scores (which you may have already have found) viewtopic.php?f=24&t=18870

Unfortunately just paying off a defaulted account may not help, as the fact that there was a default in the first place indicates to a potential lender that there is a risk factor. Remember a default occurs when you fail to adhere to the terms and conditions of an account, most occur through a person failing to make payments.

Irrespective of if you pay these off or not, a default will show for 6 years form the time it was issued, all that will change is the balance on the account and if it is also shown as settled or unsettled, the default remains.

Let us look at this form the lenders point of view. You have had several loans/credit cards/store cards/etc in the past, you failed to make all the contractual payments, so defaults were issued against the account, this means to the lender that you are a higher risk applicant. So you now wish to loose those accounts by paying them off, but in doing so you find the defaults will still remain on the file, these are statements of facts and not indications of if the account is paid up or not.

As I have said the defaults will drop of your credit files 6 years from the date they are placed (in fact the whole account will drop off 6 years after there are placed) irrespective of if they are settled or unsettled.

This has further been complicated by the fact that mortgage lenders now have to do a check on future affordability of a loan, and if there is past evidence of either not being able to afford loans or none payments of loans, that raises the mantra about your future affordability.

I know it will not be much help to you, but lenders often pick the smallest excuse NOT to issue a mortgage, even to people with experientially good credit files, as it a way the bank limit the amount of money they lend!

#471193 Hi Tim,

Thanks for your reply, very helpful.

I guess, I do not have many options left right now.


User avatar
#471223 Something that you should do is check all the other entries on the files, pay attention to the Electron Registration and all the account information.

Also check the linked addresses, as even slight descriptions between any address you give and any on record can completely block an application.

Also it may pay to talk to a mortgage broker rather a main lender at this stage, as some may be able to find slightly more flexible products for you.

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