Missed phone bills to cost mortgage?
A new report suggests that late or missed payments on a mobile phone bills could come back to haunt would-be homeowners looking to secure a mortgage for a new home.
Research conducted by loan, mortgage and credit card provider Ocean Finance shows that nearly four million people have missed or deferred their mobile phone payments.
Assessment
More and more lenders are conducting stricter affordability checks on all mortgage applicants, impacting the amount people can borrow and the length of time applications can take.
When quizzed about why they missed or delayed payments, half of consumers said that their bills were unexpectedly high. A third of respondents said that they delayed paying their bill as they had to prioritise other payments.
Data from the report shows that those in the 18-24 year old category were most likely to have problems with paying their phone bills, with almost 25% admitting to late payments.[1]
Missed phone bills to cost mortgage?
‘Mobile phone contracts are a form of unsecured credit and having as little as one late payment in the past three years can dramatically affect people’s chances of getting a mortgage,’ commented Gareth Shilton of Ocean Finance.[1]
‘Lenders are now scrutinising every detail of an applicant’s finances, stress-testing their ability to manage a budget and withstand potential interest rate increases. If you plan to apply for credit, make sure you tidy-up your bank statement in advance. Put in place direct debits and set aside the money to pay them, and then cut back on unnecessary spending. It’s crucial to get ‘mortgage fit’ or you may risk losing a house you’ve set your heart on,’ Shilton concluded.[1]
[1] http://www.propertyreporter.co.uk/finance/could-missed-mobile-phone-payments-cost-you-your-dream-home.html