Homeloan with bad credit...

M

mr_milkman

A few years ago I moved overseas and my mother moved into my house on the condition that she would cover the repayments for me. Anyways, of course she fell behind on the payments and the house was almost put up for sale by the bank.

I managed to catch up with the repayments once I found out what had happened, but by then I'd been reported to the mortgage board according to one of the letters I read from the bank.

I've since learned my lesson. I've sold the property and am now renting but would like to buy again in the near future.

Is there any way I can repair my credit and get back into the game? Or am I doomed to spend eternity as a renter.... :(
 
what exactly is on your credit file? depending on what is there it might be possible to get 70%, 90% or up to 95% of the properties value when you purchase again. It may be normal rates, or it might be rates a little higher.

Do a credit report, if you havent done one already.
 
Thanks for the input guys.

It was around 5 years ago now. I think I had fallen behind on the water bill and rates back then too (which were also supposed to be paid while I was gone...)
I haven't fallen behind on a bill since then though.

I haven't checked my credit file yet, this was my first port of call before I look deeper into it. I'm doing a bit of research as I build my savings up. I figured if I had a good size deposit it may make things a little smoother.

I'm pretty sure the letter referred to the mortgage board, perhaps it was mortgage lenders insurance board?
 
Some defaults do drop off your credit file after 5 years. It would definitely be worth getting a copy of the report before trying to get finance. Go to www.mycreditfile.com.au.

Even if the default doesn't appear on the report any more, I'd recommend using a different lender.
 
mr_milkman said:
Thanks for the input guys.

It was around 5 years ago now. I think I had fallen behind on the water bill and rates back then too (which were also supposed to be paid while I was gone...)
I haven't fallen behind on a bill since then though.

I haven't checked my credit file yet, this was my first port of call before I look deeper into it. I'm doing a bit of research as I build my savings up. I figured if I had a good size deposit it may make things a little smoother.

I'm pretty sure the letter referred to the mortgage board, perhaps it was mortgage lenders insurance board?
Click to expand...

Just get a copy of your credit report. Its a bit 'how long is a piece of string' until you know whats listed on your credit report.
 
Given the "incident" occurred 5 years ago; it would be ok ...presuming the last listing was 5 years ago.

If you have had another listing in the last 2-3 years; it would make things slightly harder depending on your LVR, type of listing, by who outcome, date and amount.
 
Knowing the amount is very important as is the LVR. First start with the credit report and then you can take it from there. Don't apply with the lender that the default took place and don't submit your application unless you are 100% sure of approval - the last thing you need is multiple credit enquiries.

Regards

Shahin
 
mr_milkman said:
A few years ago I moved overseas and my mother moved into my house on the condition that she would cover the repayments for me. Anyways, of course she fell behind on the payments and the house was almost put up for sale by the bank.

I managed to catch up with the repayments once I found out what had happened, but by then I'd been reported to the mortgage board according to one of the letters I read from the bank.

I've since learned my lesson. I've sold the property and am now renting but would like to buy again in the near future.

Is there any way I can repair my credit and get back into the game? Or am I doomed to spend eternity as a renter.... :(
Click to expand...

Welcome to my world.

I went thru the same thing years ago....it was hell. Same thing - missed gas bill (optus) and internet (aapt)...~ $400 in total. Both last bills and they got lost in transit. Both bills eventually paid off when they came to my attention - but after they slapped me with a Veda bad credit rating. I was never able to repair the credit, and trust me, I tried so hard.

As a result, my bad credit has haunted me like a black cloud for every loan, home, personal, car, I've ever gone for.

Still, there's hope. In that time I have managed to procure a car loan (VW finance), mortgage (Suncorp) and personal loan (CUA). It's not impossible. Countless lenders knocked me back while the three above took a rational approach and asked for an explanation. Depends on the lender and other factors. I found it extremely hard to get a mortgage, even though I had 10% deposit. It was the Glenworth's who were causing me grief and not so much the banks. Oh man, those were stressful days.

However, it seems that with each new successful loan, those past credit misdemeanors seem to lose their relevance somewhat. Just be totally honest with the lender. In fact, I have a tried and trusted template letter than I use every time - it explains why I incurred those debts, how I attempted to fix them, and how I've proven in the time since to be a good little borrower.

I think I’m nearly at that 7 year point where they get totally wiped from my record. I'll raise a toast to myself when that happens.

Best of luck.
 
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