Getting a mortgage after bankruptcy

Discussion in 'Personal Insolvency, bankruptcy, etc' started by MikeL2007, Jul 12, 2016.

  1. jayboy

    jayboy Registered User

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    6
    I do not know how this is possible. I might have to look at some alternative credit union in my area or around by my college and see can I open an account there. I don't really know what else to do in this sense. The only problem is if I open account and apply for loan straightaway they may check the ICB and find me on there until 2021.
    I am gobsmacked that you can open an account and then apply for a loan and get it even before opening the account and speaking with loan manager about your bankruptcy. I would feel you were in a financially better off position to me as you might have had a job which was good wage so you could show repayment capacity for the loan but even at that its a strange situation. I have a different circumstance, I work part time at weekend but don't really want to mention too much on this forum on that. I am trying to move from where I am living at the moment to a bigger place but am caught for the deposit and have no way of accessing credit until 2021 according to ICB.
    I am hopeful I will get job after college in May but that will take time to save up. I am at a bit of a crossroads at the moment on this.
     
  2. Fresh-Start

    Fresh-Start Registered User

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    12
    Hi Anbhfuilcead,
    I believe you are correct, who confirmed this for you?

    I can find material from the UK but I can't find anything in Ireland so far...
     
  3. martileo

    martileo Registered User

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    3
    Hi all, I'm new on this forum so thank you for all posts and directions. Especially the uplifting ones.
    I wonder if there is somebody here whose mortgage has been taken over by Tanager/Lapithus. Quite a recent article in the Independent quotes over 2000 customers snapped by them.

    I took a joint mortgage in 2006. Lender - Bank of Scotland. 4 years later in 2010 I was forced to move out for personal reasons. Spent next 6 years trying to find a solution first dealing with the Bank directly, then Certus. Eventually Tanager. The co-owner, ex partner still residing in the property wouldn't agree to any of my proposal. I never got any advice, support or assistance from of the institutions representing the lender. I ended up talking to New Beginning and ended up going bankrupt being unable to pay both, rental cost and mortgage instalments. My ex partner is still in the property. Making full repayments but with no intention of taking over full mortgage.

    I was discharged after 12 months. Now in the so called change over period which I guess will end in November. I got married 3 years ago and together with my husband we have good household income plus 40% deposit. Approached 2 banks AIB and Permanent). Initially they offered to lend 220k but they wouldn't speak to me once they heard about bankruptcy. Two brokers explained to me that topic of bankruptcy is still very fresh in Ireland, financial institutions don't really know how to deal with it and told me to come back in 5 years time;( But I'm not losing hope yet.
     
  4. Dauhee

    Dauhee Frequent Poster

    Posts:
    90
    UB and PTSB may be worth a go. PTSB in particular don't have a hard-set rule regards to post-bankruptcy. You would need to have solid history of payments i.e. renting, and no additional black marks on credit report (get both yours' ICB report for 12ish Eur), and keep putting set amount of surplus each month away into separate account and don't touch it (ever). It doesn't matter if you are heroic with your saving, their spreadsheet will tell them what your disposable income is, regardless of how much extra you may be able to scrimp and save. Having dependants will reduce what they deem you can afford.

    If you can position your husband as the lead (with the squeaky clean history), and ask reps to talk to their underwriters on the possibility. Main thing is to be open and offer to furnish whatever information they require, esp regarding the bankruptcy. Anything fact/document based, particularly regarding the necessitating circumstances, they don't like the he said/she said rundown of the whole thing. If you have an ongoing post-bankruptcy payment order that may make them nervous. a <60% LTV is positive.

    "fool me once, shame on you, fool me twice, shame on me". They just don't want to get caught out. If financial standing is good, then the risk will be the constraining factor, anything you can do to demonstrate a minimised risk will help.

    BOI are nervous. KBC probably won't want to ever touch you.

    You will get conflicting and possibly incorrect (negative) advice from brokers. they generally don't want the hassle/blowback of working with higher risk clients

    Best of luck. You can do it!
     
  5. MikeL2007

    MikeL2007 Registered User

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    34
    Hi folks,

    Just to give an update on our situation. As per the thread back in October, KBC seemed to react accordingly to a complaint from the FSO. Eventually updating the status on that loan to withdrawn.

    However my wife is now having a battle with PTSB through the FSO to get a loan updated to the correct status. Having been declared bankrupt in 2014, my debts are listed as being removed in 2019 (correctly) but her PTSB debt having declared on the date are sitting with a removal date of 2022. They refuse to play ball and are making excuses ranging from 'the official assignee delayed in transferring possession the property' to 'the property is not sold yet'. This despite the fact we know that the property is occupied.

    We've found a favourable lender that is willing to consider a mortgage application from us having reviewed our situation but this could be one blocker too far for them.

    Mikel
     
  6. breakonthru123

    breakonthru123 Registered User

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    32
    @MikeL2007

    At what date are banks meant to change your ICB etc. records to show mortgage loans as ‘withdrawn?’ After you’re declared bankrupt or after you exit bankruptcy?

    And is that procedure a statutory obligation - or - just based on the whim of the particular bank you previously had a mortgage with??

    Cheers!
     
  7. Smashed123

    Smashed123 Registered User

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    1
    This is a great post ,its great to see people talking about this issue. Im in the process of applying for a mortgage through a broker with my squeeky clean partner. Ive recently been discharged from bankruptcy and we're going to try find somone to lend to us if possible... my question is am i a 20% second time buyer house is gone back to bank or are we as a couple a 10% first time buyer .There seems to be a lot of gray area out there regarding each banks rules.
     
  8. RedOnion

    RedOnion Frequent Poster

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    1,411
    There's no grey area. There's legislation setting out the meaning - if either of you have ever previously had a home loan, in the republic, you're not a first time buyer.
     
    breakonthru123 and David1234 like this.
  9. Jane09

    Jane09 New Member

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    3
    Hi
    Any more updates on anyone getting a mortgage since being discharged ? Or people who have approached banks what kind of response are you getting ? And who do you make appointments with to discuss getting a mortgage with ?
    Mikel2007 any luck on the bank you approached ?
    Thank you for any responses in advance.
     
  10. Dauhee

    Dauhee Frequent Poster

    Posts:
    90
    Things that will help you:
    • meet face to face, build a relationship, try get an area/territory sales manager
    • having 12+ months since discharge
    • have a savings/current bank account with the bank you are applying to and have your wages put in, 12+ months of this can help
    • have good disposable income (according to their scoring system)
    • if joint application, if switching and existing mortgage is in non-bankrupt spouse
    • ask them [nicely] to refer to their underwriter if not getting accepted
    • have your finances under control, be able to demonstrate good understanding and planning
    basically, banks want to loan, but they also don't want to get stiffed. If you can get an area sales manager, they will be able to sway things in your favour if you are genuine and don't present as much risk.

    Its still unknown territory for them with post bankruptcy, UB and PTSB seem to be more open to the idea currently
     
  11. Jane09

    Jane09 New Member

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    3
    Thank you Dauhee for your very detailed reply.
    Just a couple more questions.

    We are both with permanent tsb with my husbands wages going into it so should we keep it there then ?

    We are only out of bankruptcy so should we just not make any appointments for 12 months ?

    Should we put our consistent monthly savings into ptsb also in the hope they give us a mortgage down the line ?

    Will we need to save 10% or 20% deposit ?

    Should we start getting small loans out now or credit cards to build up our credit rating or does it not work that way in Ireland as we don’t have a credit score system ?

    We are renting consistently for 7 years now paying 1450 rent so we have a good record there


    My husband was bankrupt with a house he owned with an ex who emigrated so it was our only way of breaking that contract as bank didn’t want to know. So it wasn’t for financial difficulty reasons. He could not sell it as it was in negative equity and ex didn’t want to cooperate :( he also had a small loan out at time of going bankrupt.

    Thank you so much for your help :)
     
  12. Dauhee

    Dauhee Frequent Poster

    Posts:
    90
    Hi Jane09,

    You could certainly try before the 12 months with PTSB. If you get to the point PTSB will definitely not accept you, could then look to save with another bank and try them for a mortgage. There is no harm in politely checking in every so often. PTSB were sympathetic to my case, but I have periodic checkins with UB and BOI also, just to keep the relationship going. Sometimes they might say contact them again in 6 months, or when your finances are at a certain point. KBC said they would never do business with me, but then again different branch reps can give different answers.

    With any bank, if they see the money coming in then that's good enough, if money is going out to separate savings account then that should be fine so I would say no need to change that.

    You can request your ICB report online for a nominal fee (6Eur or something like that), while banks will be doing their own checks, at least you can highlight how good (apart from bankruptcy) the finances are.

    Unfortunately because you are married, with the homeowners act, you need to make a joint application. Depends on how desperate you are for a mortgage - divorce could solve your problem :)

    yes loans and ccard do get listed on your ICB, but is pointless getting a 1k loan and paying it back as the value is listed also. They will be looking for longer term history.

    I'd say you should aim for 20% deposit

    Definitely meet sales managers from each bank and listen to what they have to say.

    Beware of independent financial advisers as they may be more negative on options.

    Best of luck
     
  13. Jane09

    Jane09 New Member

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    3
    Thanks a million for your reply I really appreciate it.
    At least now I have a starting point.
    I just can’t wait to hear even from one person to say they got a mortgage just to even know it can be done :)
    Light at the end of the tunnel :)