Getting A Mortgage With A Default

Our clients were a couple in their early 40s with two children looking to move into a bigger property. They currently owned a 3-bed terrace house and was looking to move into a 4-bed semi-detached as their family had outgrown their existing property.

The client worked as an employee and had shares in a recruitment company however, had an issue with a utility provider. They had tried to cancel their subscription for a few months but with no luck so cancelled their direct debit. The provider tried to collect their money and couldn’t so put a default against their name for a very small amount. 

The default against their name meant that all of the high street lenders would not consider their mortgage with a default application as the debt hadn’t been cleared. If they had cleared the debt then this would still be on file for three years delaying any future mortgage applications to a high street lender. 

Our adviser Iain Belcher, spoke with a bespoke lender, where they agreed to review their case as the client was a high income earner and the debt was very much out of character. Iain spoke with the underwriter directly, which is very unusual and discussed the client in detail, their past history and they were able to take a more personal review of the case and offered the client a mortgage. 

The lender normally offers bespoke rates which are higher than other standard rates as this represents the risk behind having to use the bespoke system, however after the reviewing the case, they were happy for our client’s to be on the standard rates. The result for the client was that it allowed them to stay with a high street lender instead of going with a specialist lender and reduced the rate by over 1%. The client had to choose a longer-term fixed mortgage which resulted in them paying less than other options available and also saved the client more money over the mortgage term. 

Resolve Financial Solutions explore all of the options available to you in order to find the perfect solution to suit your needs. Get in touch today to discuss your requirements.

*Your home may be repossessed if you do not keep up repayment on your mortgage.

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