Buying a Residential Property with a Poor Credit History

Client’s Situation

Our client was born in Italy but has been a resident and employee in the UK for a number of years. He was in his early 50s with no dependent children ( he had a grown-up daughter in Italy from a previous marriage ) and was living with friends. His income was moderate.

He wished to purchase a property and discovered a work colleague was selling a two bedroom flat for £95,000 which he agreed to purchase.

Our client had a large deposit available (equivalent of £40,000 sterling) held in Euros in a savings account in Italy.

The Problem

A couple of years ago our client sadly had to return to Italy following the death of his father to sort out his financial affairs.

At that time the client had a small personal loan and small balances outstanding on a couple of credit cards with his bank in the UK. These payments were always made on time.

Our client left funds in his UK bank account to cover the monthly loan and credit card payments but, due to unforeseen delays in Italy regarding his late father’s estate, he returned to the UK many months later than anticipated and had miscalculated the funds left in his account which led to him missing several payments.

This led to his UK bank placing three defaults against our client’s name. On his return to the UK our client immediately repaid the monies owing in full but the damage had been done as these defaults (although satisfied) showed on his credit file.

The Solution

After researching the market we found a lender willing to accept our clients’ 3 defaults and to lend the full mortgage amount required which meant our client could purchase the property.

The lender required confirmation of the deposit which we were able to do by producing the bank statements from his Italian bank which showed the Euros being converted to Sterling and his UK bank account showing receipt of these funds.

We also had to confirm to the lender that the property was being purchased at full market value since the sale was not going through an Estate Agent and was therefore classed as a ‘private sale’.

Conclusion

Our client is now the proud owner of a 2 bed flat in Manchester.

Summary

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Manchester Mortgages is a trading name of Mortgages 4U (North West ) Limited which is authorised and regulated by the Financial Conduct Authority (FCA register number 301076). Registered in England & Wales No. 4729252. Registered office: 7 Randale Drive, Bury, BL9 8HZ.
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