Mortgage next year-no credit rating

[nextyear]

My wife and I may be looking for a mortgage in about a year or so.As I have recently lost my job,we will need to rely on my wife's wages to secure one.I have just got a credit report for my wife as before we married she had multiple defaulted loans,credit cards etc which had gone as far as solicitors but not to judgement.All loans were fully paid off about 6 years ago and the icb report came back as no records held.
As my wife was so poor with money,all her wages now come into my bank account and there are no current financial issues.
My question is,in the credit climate we live in now,is a completely blank credit record looked on suspiciously by mortgage lenders?Should she take out a small personal loan (of short duration obviously) to establish some sort of credit history?

 

[jhegarty]

Blank just means you didn't take out a loan.

Can't imagine any bank seeing that as a negative in the current climate.

 

[Whopper]

A blank ICB will be fine with the banks. The main criteria for them at the moment is repayment capacity. Once the banks can see that you show an ability to repay the loan amount on a stressed rate, you will be fine. There are a number of ways to show repayment capacity and ability. The main things to get going now are to set up a savings account and have a regular amount going into it. If you rent, make sure your repayments are paid through your current accounts so there is a paper trail which will be the equivalent to making repayments on a loan. Also keep your current accounts in order, in other words no referral fees.

Hope this helps

 

[VOR]

The main things to get going now are to set up a savings account and have a regular amount going into it. If you rent, make sure your repayments are paid through your current accounts so there is a paper trail which will be the equivalent to making repayments on a loan. Also keep your current accounts in order, in other words no referral fees.

I would completely agree with the above. Save all you can in to a separate account. Keep the current account clean and make sure there is money in there at the end of each month. That's essential. If it looks like you are living from one pay cheque to another you haven't a hope.

Watch the transactions on your account. The current account LASER transactions are a window in to your lifestyle. The better it looks, the better you will look to the bank. I heard Matt Cooper speaking to someone recently about internet betting and how the lenders hate to see it on a credit card or current account. In short, don't do it.

Same thing goes for constant LASER transactions in an off licence or ZARA, Debenhams etc etc.

Best of luck with it.

 

[nextyear]

Thanks for all the advice.Another question for you experts -Will the bank lend extra on top of a very discounted sale price(family executor sale) to pay for renovations?
To fill in price c 100k renovations c35k value when done up c170k

 

[jhegarty]

Thanks for all the advice.Another question for you experts -Will the bank lend extra on top of a very discounted sale price(family executor sale) to pay for renovations?
To fill in price c 100k renovations c35k value when done up c170k

Not a chance , even during the good times.

 

[VOR]

I'll differ from jhegarty slightly. No and Yes.

No at the outset. There's no way they will give you the money when the place is bought as you would be looking fo more than the purchase price, irrespective of the value. If it is really run done they may say no altogether as the house will not be habitable.

However, they could agree to issuing the money when the place is completed based on a final valuation.

In other words, you get approved for €125,000 being 90% of the purchase price and 100% of the renovations. You can't get near the €35K until the work is done and only if the valuation stands up. There is no guarantee of that at the mo.