Browse Forums Home Finance 1 Sep 20, 2011 12:31 am Hi everyone, Hoping someone that has had this issue and sucessfully built can help. Just recieved our credit reports in preparation for our loan shop around. My partner has perfect credit! My credit is another story. Im currently paying off an old credit card debt with about $1400 left and it is listed as a default as I went back on my payment agreement. I also have a paid phone bill which was listed as a default while I was disputing the amount. Im trying to get Virgin to remove it! We have been using mortgage calculators and have spoken to a few brokers who believe my partner can borrow a maximum of 315k on his income alone but we would like more borrowing power. Our budget is 350k so we are saving up the difference but would also like to have some extra for those "just in case" expenses and to furnish as we are moving from a tiny townhouse into what seems like a three bedroom+theatre, study, garage, 'linen cupboard that could house a small family' monstrosity LOL! Anyway, We were thinking there must be someone in the same boat as us! Perhaps we could use the rent I pay into my partners account as extra income or is there some way we can use my income without putting my on the loan? Paying an agency to remove the default is out of the question as the cost of that is more than I owe on the account. Thankyou all in advance for your help! One applicant with bad credit. What can we do? 2Sep 20, 2011 6:33 am How much deposit will you have? If you are trying to borrow on less then 20% deposit then the Mortgage Insurance company has the final say. And sorry to say but they don't like bad credit. Especially if you still haven't cleared the outstanding amount. In their eyes you are already a bad credit proposition showing little regard for repaying debts incurred. If you have more then 20% deposit then it is the Bank's approval - and they may be more lenient. However they may still say that you have to pay the outstanding amount. The only other way around it is to go in sole name of your partner but he will have to show serviceability solely in his name - you paying "board" or rent will not count. Some things are worth waiting for. Re: One applicant with bad credit. What can we do? 3Sep 20, 2011 1:55 pm Hi First Build Boys, The responses you have got arent bad for 'general advice' in this circumstance. With your situation however you really need a more specific response one that your broker SHOULD be able to cover if they have had non conforming experience in the past. This is all risk based from the bank and the mortgage insurers point of view. A telecommunications default is not as high risk as a bank default. A default from 1 month ago is more of a risk than a default from 3 years ago and good repayment history since. Things that the bank and mortgage insurer take into account when looking at defaults: - The amount of the default - The date of the default - Whether the default was a 'disputed' item at the time of lodging - Whether it is updated on the credit report to paid or not - Whether there was a 'life event' that occurred around the time of the default or if it was in fact a non repayment event without cause - The steps you have taken since the default that would reduce the likelihood of such a thing reoccurring All of these go towards building a risk profile. There are a number of lenders that can look at minor defaults (even in mortgage insurance territory) favourably with the right mitigants. (And no these arent all higher interest rate and larger fees) A couple of them can be accessed by brokers and some you go direct to. If you would like some more specialist directions feel free to PM me. By the sounds of it your talking about 2 defaults totalling less than $2,000.00. One of which is a Telecommunication default. There are quite a few lenders that will definately look at this and would be willing to look at the applications strengths/merits. One thing that is almost guaranteed to have to be done is to have them both paid out and the credit report updated to paid. Once again, if you would like some direction on the process involved to do that feel free to PM me. Dont think that it is all doom and gloom. Hope this helps. Regards, Trent Davidson Property Finance Consultant Residential Lending LJ Hooker Finance Brisbane North Credit Representative Number: 387283 under Australian Credit Licence:380270 Re: One applicant with bad credit. What can we do? 4Sep 22, 2011 8:41 pm I had a bad credit file which i recently cleared with using a solicitor. it was a default and a judgement. both have been cleared as though they were never there. PM me for the solicitors details if you are interested. all up for the judgement and default it was $2400 Oh and the plus, i had $1800 owed on the default and they wiped it too ___________ Started design Aug 2011 Plans submitted to council Dec 2011 One applicant with bad credit. What can we do? 5Sep 22, 2011 9:58 pm bigboyberger I had a bad credit file which i recently cleared with using a solicitor. it was a default and a judgement. both have been cleared as though they were never there. PM me for the solicitors details if you are interested. all up for the judgement and default it was $2400 Oh and the plus, i had $1800 owed on the default and they wiped it too Another way of looking at it is that you cleared the default and paid a solicitor $600 to do the dirty work for you. When did we become a society that doesn't want to take responsibility for debts we incurred? How sad. Some things are worth waiting for. Re: One applicant with bad credit. What can we do? 6Sep 23, 2011 10:08 am kyton bigboyberger I had a bad credit file which i recently cleared with using a solicitor. it was a default and a judgement. both have been cleared as though they were never there. PM me for the solicitors details if you are interested. all up for the judgement and default it was $2400 Oh and the plus, i had $1800 owed on the default and they wiped it too Another way of looking at it is that you cleared the default and paid a solicitor $600 to do the dirty work for you. When did we become a society that doesn't want to take responsibility for debts we incurred? How sad. I had paid that $1800(receipts), which a mechanic at the time said i hadn't. Its something i should have taken up with a court at the time but couldn't afford that. I probably should have said that in my previous post. What choice did i have but to remove the judgement via a solicitor, i can barely afford to build at the moment, what chance do i have in 3 -4 years time. The default was for a minimal amount too(under $100). ___________ Started design Aug 2011 Plans submitted to council Dec 2011 Re: One applicant with bad credit. What can we do? 7Sep 23, 2011 10:50 am Then that is an all together different matter. From your second post it seems that you shouldn't have had the default loaded in the first place if you had receipts proving payment was made in the first place. The original poster has stated "Im currently paying off an old credit card debt with about $1400 left and it is listed as a default as I went back on my payment agreement." This indicates that he knows that the default was going to be listed, he reneged on an agreement made and therefore is now going to have to face the consequence of not paying that original debt. It is an altogether different matter when you are unfairly listed with a default - and then you can legally have the listing rescinded from your credit file. Some things are worth waiting for. Re: One applicant with bad credit. What can we do? 8Oct 24, 2011 12:15 am Thank you to everyone who replied to my post! We have ended up saving more instead and have also decided to keep me off of the loan and deed so we can keep a second first home buyers grant. $7000 goes a long way and this will not be our last home! Re: One applicant with bad credit. What can we do? 9Oct 24, 2011 8:04 am Hi, I would be very reluctant not to have my name on the deed and I would be considering legal advice. If you are also contributing funds to the home you should be listed. If your partner was sued for some reason then I think this could cause you grief. If you are both be living in the home together and in a future home you can't get first homeowners twice. 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