Ian Fitzgerald is area development manager at Thinc
I would firstly establish that the missed payments have been paid and that his credit card account is up to date. This can have quite an impact of Mr Chivers credit record and I would recommend that he checks on this via companies such as Experian or Equifax.
Many lenders will ignore defaults as long as the account in question has been bought up to date. The key factors here would be the conduct of Mr Chivers main residential and BTL mortgage accounts. As long as Mr Chivers has kept up the payments on his main residential mortgage and also all his BTL mortgages I would be confident of arranging a new BTL mortgage for him at the very best rates available.
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However I would have some concerns at how credit card payments could be missed and would want to discuss the reasons as it is my responsibility to ensure that any recommendations made for mortgages are affordable. I would want to ensure that the missed card payments do not occur again and that arrangements are in place to pay all monthly commitments when Mr Chivers is not in the country. As long as these factors are all covered I see no reason why Mr Chivers should not proceed with his new property purchase and BTL mortgage.
Cath Hearnden is director at My Mortgage Direct
Increasing numbers of lenders are moving into the near prime market which is essentially aimed at people who have missed a few payments but are now up to date. Traditionally this was the area of prime lending which applied common sense underwriting but toady more underwriting is computerised and automatically excludes any poor credit.
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Mr Chivers should obtain a copy of his credit report from Experian and Equifax to see exactly what missed payments have been recorded. If they only show a couple of late payments he could approach one of his existing lenders with whom he has a good payment history. Even if the initial credit check declines the loan on mainstream it is worth asking the lender to consider the case further in view of the existing relationship. They will need the reason for the missed payments and may ask for more information about Mr Chivers. If they still cannot offer a mainstream rate they should will cascade it to a near prime product.
If the lender will not lend on prime or near prime or if the report shows more serious defaults Mr Chivers should be able to get a loan on a non-conforming rate which many lenders now offer.
Paul Hunt is head of marketing for Platform
Credit card defaults are becoming a common occurrence for many and so, unfortunately, Mr Chivers’ situation is not uncommon in today’s climate.
As unsecured debt levels continue to rise, such problems will affect many more people over the coming months. In fact, it has been reported that Britain’s personal debt is increasing by £1 million every four minutes.
Having said this, at Platform we have a number of options available.
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As we ignore unsecured defaults (credit cards and loans for example), Mr Chivers can access our conforming range of fixed rate and tracker products.
Platform launched its 110 per cent buy-to-let rental calculation option in February and this is available up to 90 per cent loan-to-value (LTV) for remortgages and purchases. A £999 arrangement fee, which can be added to the loan, applies.
Alternatively, he can still opt for a 125 per cent rental calculation, which has a £695 fee.
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