Mortgage with Settled Defaults

It's surprising that your broker is unable to get you the mortgage you’re looking for based purely on this one historic adverse credit item. 

Settled Default Impact on Your Mortgage Application 

Whilst it’s true that at the higher LTVs (loan-to-values) adverse credit events will have a negative impact for many lenders, this tends to be more commonly be the case with high street lenders. There are many other lenders with more flexible criteria and manual underwriting practices that enable them to consider mortgage applications with a settled default. Furthermore, the default is quite historic, so it seems a little odd that this is the sole reason for you being told that you can't get a mortgage. 

As an independent and whole of market mortgage broker, we deal with those lenders who still manually underwrite cases and can therefore judge each application on its individual merits. 

Without knowing the full details on the rest of application we can't be any more definite, but as long as the rest of your credit history is OK, it's likely that you should be able to obtain a mortgage with settled defaults.

If you have a copy of your credit file, then we'd certainly suggest speaking to one of our consultants to see what we could do to help you.  

What Else Can I Do if I Want a Mortgage with a Settled Default? 

There are still some steps you can take to improve your chances of securing a mortgage, even if you have a settled default in your history: 

1. Check your credit report - obtain a copy of your credit report from all major credit bureaus to ensure that the information is accurate and up to date. Sometimes, errors or inaccuracies on your credit report can negatively impact your credit score and ability to secure a mortgage. If you find any errors, you can dispute them with the credit bureau to have them corrected 
2. Explain the circumstances - if there were extenuating circumstances surrounding the default on your credit card bill in 2009 - such as illness, job loss, or other financial hardship - you can provide an explanation to the mortgage lender. Some lenders may be more understanding if they’re aware of the circumstances that led to the default 
3. Provide evidence of responsible financial behaviour - since the default in 2009, if you have demonstrated responsible financial behaviour - such as making timely payments on all your bills, maintaining low credit card balances, and managing your finances well - you can provide evidence of this to the mortgage lender. This can include bank statements, utility bills, and other financial documentation 
4. Build a larger deposit - increasing your deposit amount can improve your chances of getting approved for a mortgage, as it reduces the lender's risk. If possible, consider saving up a larger deposit to increase your chances of securing a mortgage 
5. Seek specialist lenders - some mortgage lenders specialise in offering mortgages to individuals with less-than-perfect credit histories or unique financial circumstances. These bad credit mortgage lenders may be more willing to consider your application, particularly if you can provide a larger deposit and evidence of responsible financial behaviour since the default 
6. Work with a mortgage broker - at John Charcol, we can help you navigate the mortgage application process and identify lenders who may be willing to consider your application despite the settled default. We can also provide advice on improving your creditworthiness and increasing your chances of getting approved for a mortgage with bad credit events in your history
7. Be patient and persistent - getting a mortgage with a default from over a decade ago may require patience and persistence. Keep working on improving your creditworthiness and exploring all available options until you find a lender willing to approve your mortgage application 

Getting a Mortgage with Settled Defaults Summary 

Overall, while having a settled default on your credit report can present challenges when applying for a mortgage, it's not necessarily a barrier to getting approved. By taking proactive steps to address any issues, providing evidence of responsible financial behaviour, and exploring all available options, you can improve your chances of securing a mortgage that meets your needs. 

Contact us today on 0330 433 2927 to learn more.