My partner currently owns a property which is sold subject to contract, we have also had an offer accepted on another property.
We are taking £30K from the sale of the property and have a £6K gift from my parents. The property we are buying is £340K so we have just over 10% deposit.
We have a decision in principal from HSBC, and the next step of course is to submit an application. I know that HSBC have changed their terms to max 85% LTV but we have been told that they may honour the 90% LTV on our decision in principal.
Aside from this, I have missed payments on my credit file from 2014-2017 on a Store Credit account. The account was settled in full in October 2017 and closed. Since then I have been very careful and my credit score is excellent.
My partners credit score and history is fine.
How is this likely to impact our ability to get a Mortgage Offer, will it mean higher interest rates, or will I even be able to get an offer at all?
Thank you in advance.
Hi, thanks for getting in contact.
A mortgage will almost certainly be possible for you both with your deposit likely to be the main hurdle to overcome.
As you've probably experienced whilst not impossible, a mortgage with a 10% deposit is very hard to come by due to current events regardless of your credit profile.
From the information provided I would expect a mortgage to be available with competitive rates if you were able to raise 15%.
Thank you for your reply,
The main issue worrying me is my credit profile, the changes to the market are unavoidable I guess due to the current climate. If that were not an issue, how would my credit profile impact our mortgage offer? Would we be likely to get an offer and would it be subject to high interest rates? Also is HSBC as a lender likely to be an issue?
I appreciate I am asking you to speculate, but thank you in advance for any advice you can give!
Without seeing a credit file I wouldn't be able to comment with exact details however broadly speaking HSBC are not a lender I would consider to be flexible and/or forgiving with credit issues.
That said, if you were to have a 15% deposit there would almost certainly still be lenders available to you with reasonable deals.
My partner has a mortgage with Nationwide, we have been told that they offer like for like LTV on new applications from existing customers and his previous mortgage was 93%. We are hoping this might mean we can get 90%, but do you know how Nationwide compare when offering mortgages to people with adverse credit?
Nationwide (like HSBC) are unfortunately not known for tolerating much adverse credit either.
You would have to check with Nationwide directly to be sure, but I think it’s highly unlikely.
All the best