Mortgage not showing up on ICB report

xElDeeX

I purchased a house via a County council shared ownership scheme in 2004. I ended up moving across the country for work at the peak of the financial crisis. I rented it at a loss and attempted to cover the repayments for many years along with rent in my new town. There's a bit of a saga about the shared ownership scheme that I won't get into but I was advised due to lack of engagement from the council to stop paying my mortgage. This eventually lead to them engaging with me and I purchased the house under a new mortgage along with all arrears at a much better rate fully under my own name - no shared ownership.

Anyway that was back in 2016. I'm still renting and in a very secure job. I'm thinking about buying here and keeping the other house. Its let out with amazing tenants for the last few years. I pay tax on every penny and the place is well kept. Eventually I'd like to settle back there. Mortgage is paid in full weekly plus a few euro extra for good luck.

I decided to get a credit check from ICB to see how I stand but my mortgage isn't on it. Is this a good or a bad thing? When I apply will it show up anyway? Do I come clean with the bank that this is a second home?
I'm a very by the books person so my inclination would be to tell them absolutely everything.

phormium

Check the Central Credit Register too.

xElDeeX

phormium wrote: »

Check the Central Credit Register too.

Waiting on that one. I applied for both on the same day. Thanks!

Q&A

xElDeeX wrote: »

Is this a good or a bad thing? When I apply will it show up anyway? Do I come clean with the bank that this is a second home?
I'm a very by the books person so my inclination would be to tell them absolutely everything.

It probably shows how haphazard the ICB was. The CCR is the one that counts.

Up to you what you tell the bank. If it's the same bank as your current mortgage they'll probably be able to work it out - but I know it's not always the case.

Unless you've a separate bank account for dealing with the rent any potential lender will likely pick it up when they review your finances as part of the loan assessment process

Are you paying a BTL rate at present? Have a look at the difference in rates. You're current lender "might" require the existing loan be converted to a BTL rate. If you go with a new lender and are clear that the new purchase is your PPR you might keep both loans as owner occupier mortgages.

Jim2007

xElDeeX wrote: »

I decided to get a credit check from ICB to see how I stand but my mortgage isn't on it. Is this a good or a bad thing? When I apply will it show up anyway?

The ICB appears to be on its way to obsolescence at this stage. The CCR presents a better overview of your situation and there is no discretion on the part of institutions when reporting.

Do I come clean with the bank that this is a second home?

I'm a very by the books person so my inclination would be to tell them absolutely everything.

Any attempt to obtain funds by deception constitutes fraud from a legal point of view. That said, lots of people put in all kinds of weird and wonderful loan applications without becoming the subject of a complaint to the Garda, so any issues there are probably very low risk.

On the other hand, if as you say you do everything by the book, your records will probably not stack up to professional scrutiny if you now start leaving bits of it out. For instance income tax paid won’t match the employer’s statements if you leave out the rental income and expenses etc...

I would advise you to play it by the book as you always have.

xElDeeX

Jim2007 wrote: »

The ICB appears to be on its way to obsolescence at this stage. The CCR presents a better overview of your situation and there is no discretion on the part of institutions when reporting.



Any attempt to obtain funds by deception constitutes fraud from a legal point of view. That said, lots of people put in all kinds of weird and wonderful loan applications without becoming the subject of a complaint to the Garda, so any issues there are probably very low risk.

On the other hand, if as you say you do everything by the book, your records will probably not stack up to professional scrutiny if you now start leaving bits of it out. For instance income tax paid won’t match the employer’s statements if you leave out the rental income and expenses etc...

I would advise you to play it by the book as you always have.

Good to know re the CCB. I'm awaiting the CCR report and in the meantime I have pulled out my original loan docs for the mortgage. I noticed they have consistently used an address I have never lived at when referring to this loan. I don't think the estate had a name when I began the process so this was used in the interim and GCC never changed it. The folio etc are correct so I do in fact own the place! I wouldn't have used this address in the credit checks so I may send them an email and ask them to rerun the report to include it.

As you said it would all show up via my bank statements anyway plus I'd be constantly be waiting for the other shoe to drop so would rather be upfront.

Trish56

If you're applying for a new mortgage and you are doing everything by the book then when you submit 6 months current account statements with your application the rent you're receiving and the mortgage repayment will show up on the statements so there's no hiding that you already own a property.

As a second time buyer you will need to have a 20% deposit and depending on the lender the rental income (normally taken at 50%) on the Investment property may not be taken into account and your mortgage will be stressed tested at 2% over and above the standard variable rate of the lender.

xElDeeX

Trish56 wrote: »

If you're applying for a new mortgage and you are doing everything by the book then when you submit 6 months current account statements with your application the rent you're receiving and the mortgage repayment will show up on the statements so there's no hiding that you already own a property.

As a second time buyer you will need to have a 20% deposit and depending on the lender the rental income (normally taken at 50%) on the Investment property may not be taken into account and your mortgage will be stressed tested at 2% over and above the standard variable rate of the lender.

Thank you. Its helpful to have that spelled out. I'm hoping to get some independent financial advice over the next couple of days also. I'm considering selling the other property and I'm not planning on borrowing a lot. Kids have flown the nest mostly and I no longer need to bankroll their education!
I have no other debt, nothing bad on the bank statements as I'm super boring and a permanent public sector job so I'm not concerned about the stress test, just the credit history. And I think I'm clearer now on re-requesting if it doesn't show up.

xElDeeX

OK so I got the CCR report there. The good news is that my mortgage is on it with all payments on time for the term the data goes back to. There is a note on it to say that the mortgage was restructured to extend the term and capitalise arrears. Anyone with experience of rejection/acceptance with similar?

Trish56

You will more than likely be asked about capitalising the arrears so I think if you deal with it when submitting your application you have a better chance than they bringing the issue up. So consider submitting a letter advising that due to the Financial Crisis you lost your job and as a result fell behind on your mortgage repayments etc. You may be asked to provide statements and you did mention that you ceased payments altogether which may go against you especially if you were earning enough to pay your mortgage and receiving rent.

Hopefully they will just accept your explanation and not look for statements.

xElDeeX wrote: »

OK so I got the CCR report there. The good news is that my mortgage is on it with all payments on time for the term the data goes back to. There is a note on it to say that the mortgage was restructured to extend the term and capitalise arrears. Anyone with experience of rejection/acceptance with similar?

xElDeeX

Trish56 wrote: »

You will more than likely be asked about capitalising the arrears so I think if you deal with it when submitting your application you have a better chance than they bringing the issue up. So consider submitting a letter advising that due to the Financial Crisis you lost your job and as a result fell behind on your mortgage repayments etc. You may be asked to provide statements and you did mention that you ceased payments altogether which may go against you especially if you were earning enough to pay your mortgage and receiving rent.

Hopefully they will just accept your explanation and not look for statements.

Some good news. I spent Saturday going through all my paperwork and bank statements from my original shared ownership mortgage, the period around where I got in financial difficulties and the resulting restructure. As it turns out I did not at any point stop paying my mortgage. I reduced the payments as my bank balance strayed into the red but always paid something. I also have letters from the council at the time where I had engaged with them looking for help with restructuring and they had refused in writing to have anything to do with it as I wasn't living in the house. At the time I also tried flying to the UK once a week to do agency work (I worked in a very niche area) to make more money to try to meet my payments.

Its amazing what comes back when you start looking at old files. Anyway I know have a record or every payments from 2004 until right now on that mortgage.

I've decided to sell that property and have give verbal notice to the tenants for 6 months time, and will have a valuation done this week. I'd be hopeful of getting 40-50k after estate agents fees. My parents also want to pitch in and are giving a 15k gift towards a deposit so hopefully I will be able to put together a much more substantial deposit than I had initially thought. Appointment for an informal chat with BOI Tuesday so I'll get a chance to test the waters.

FromADistance

xElDeeX wrote: »

Some good news. I spent Saturday going through all my paperwork and bank statements from my original shared ownership mortgage, the period around where I got in financial difficulties and the resulting restructure. As it turns out I did not at any point stop paying my mortgage. I reduced the payments as my bank balance strayed into the red but always paid something. I also have letters from the council at the time where I had engaged with them looking for help with restructuring and they had refused in writing to have anything to do with it as I wasn't living in the house. At the time I also tried flying to the UK once a week to do agency work (I worked in a very niche area) to make more money to try to meet my payments.

Its amazing what comes back when you start looking at old files. Anyway I know have a record or every payments from 2004 until right now on that mortgage.

I've decided to sell that property and have give verbal notice to the tenants for 6 months time, and will have a valuation done this week. I'd be hopeful of getting 40-50k after estate agents fees. My parents also want to pitch in and are giving a 15k gift towards a deposit so hopefully I will be able to put together a much more substantial deposit than I had initially thought. Appointment for an informal chat with BOI Tuesday so I'll get a chance to test the waters.

Unless you paid the full contracted amount per month (on your first mortgage), the record on the CCR is likely correct. Before you start selling your house etc, it might be worth submitting a mortgage application to 'test the waters'. You don't want to be left with no house as for a second time mortgage, you will require a min 20% deposit and be subject to a 3.5 times salary cap (without applying for an exception). Term will also be an issue as most banks won't allow you go past pension age. Some banks may take issue with the fact your mortgage was restructured / extended because of arrears. I wouldn't commit to selling your house until you have at least an approval in principle in your hands.

xElDeeX

FromADistance wrote: »

Unless you paid the full contracted amount per month (on your first mortgage), the record on the CCR is likely correct. Before you start selling your house etc, it might be worth submitting a mortgage application to 'test the waters'. You don't want to be left with no house as for a second time mortgage, you will require a min 20% deposit and be subject to a 3.5 times salary cap (without applying for an exception). Term will also be an issue as most banks won't allow you go past pension age. Some banks may take issue with the fact your mortgage was restructured / extended because of arrears. I wouldn't commit to selling your house until you have at least an approval in principle in your hands.

Thank you for your advice. I will probably go ahead and make an application anyway. I don't have any arguments that the notation on my CCR report is incorrect. I just couldn't remember the exact situation and whether i had stopped paying completely. It was a stressful time. To clarify I don't live in that house. It is rented out so not having a house is not an issue...I'm already renting near where I want to buy.

xElDeeX

FromADistance wrote: »

Unless you paid the full contracted amount per month (on your first mortgage), the record on the CCR is likely correct. Before you start selling your house etc, it might be worth submitting a mortgage application to 'test the waters'. You don't want to be left with no house as for a second time mortgage, you will require a min 20% deposit and be subject to a 3.5 times salary cap (without applying for an exception). Term will also be an issue as most banks won't allow you go past pension age. Some banks may take issue with the fact your mortgage was restructured / extended because of arrears. I wouldn't commit to selling your house until you have at least an approval in principle in your hands.

Update on this. I went ahead and submitted an application through a broker and was upfront about my credit history. The mortgage was reportedly refused based on a restructure from 2019 on my credit report. This is an error as this occurred in 2016 so I'm now in the middle of the process to either have that amended or removed. The lender are in agreement that its incorrect but unsure how to resolve it (its the council not a bank) and are contacting the dept for guidance. I went ahead and read the SI and the booklet released by the ccr and im none the wiser so not surprised there are inconsistencies!