Mortgage application/credit rating query

greensheep777

Hope someone here can help me! I decided to start saving for a mortgage a few months ago. I ordered a copy of my credit rating and there were no missed payments on it, all looked perfect.

I got a balance transfer done to pay off my credit card and thought I would receive no more bills but one came for 28e for fees and charges. I rang the bank to pay it off but kept getting cut off on the phone - long story short, I then went away on business, forgot about the payment, and came home to find that my account was in arrears for > 2 months.
I have now paid off the 28e and closed the credit card account but have been informed the arrear will likely go on my credit rating.
Is 1 count of arrears usually a huge black mark for a mortgage application? It was such a stupid mistake, a very small amount of money that I forgot about - I wasn't in financial hardship. Do the banks take that into account?

I'd be a first time buyer and a sole applicant. My salary is 60k, I work in private sector IT in a full time permanent PAYE job. I'm now very stressed and feeling very stupid!

tony1980

We had something similar for a credit card two years ago which showed on my wifes icb report.

She wrote a letter to explain what had happened which went in with our application back in November. We used a broker from the bank, the underwriter was satisfied with the explanation and there was no issue. We have our loan offer with the solicitor waiting to draw down now. You should be fine!

davindub

I think you can appeal it, but chase up your credit card provider to get an full explanation of what they will be submitting. Forgetting a credit card bill of 28 for fees and charges euros shouldn't affect your rating, but argue like hell until you get someone's attention in there and they give you a straight answer.

notkenny

I think it depends on which bank you are applying to and how strict they are with this. I have seen same situation before KBC did not accept it but EBS and AIB are ok with it and approved mortgage for the applicant.

greensheep777

Thanks for your help so far guys! I was expecting you all to tell me I'm a financially incompetent moron so was bracing myself haha!

Do you think it will look good that I immediately closed the credit card account after paying the amount off?
I asked for the card to be closed while on the phone because I was so annoyed and wanted to make sure it could never happen again. I read afterwards that the last 24 months of payments is what shows on the ICB report. Is it the last 24 months before the card was closed, or the last 24 months before the date the ICB report was generated?

I have applied for a new card with KBC now. Not because I need one, but because I want to keep building my credit history and show that I can have credit available to me without me relying on it. Also to establish a relationship with KBC in case I apply to them for a mortgage.

Smiley012

I was in the exact same situation with my credit rating - I had the same amount of missed payments - mine was 2 standing orders I had forgotten about. I moved country, Mum was polite and didn't open my mail. 3 missed payments and the debt was written off by BoI - this was 2011.
Fast forward to this year, I'm trying to apply for a mortgage. 
KBC declined me, using that as the primary factor. Keep in mind I had stellar savings, solid employment history and no missed payments since. It was also for the grand total of 56euro. 
I applied to BoI, supplying the exact same information - my ICB report, my credit card statements from that period. They said it was a "genuine" reason, and I was approved for the mortgage. 
It's the last 24 months before the card was closed. Mine was closed in 2012, and the debt appeared 3 months prior to the closing date. I have to wait until 2017 for the whole thing to be wiped. 
I have spoken to many people about applying for credit through KBC - IMO they definitely aren't the best bank to go through. Don't get distracted by the seemingly lower interest rates - cash back offers are better. You can also switch in a few years (make sure you read your contract- I know it's costly to move, just my own opinion!)

mel123

Smiley012 wrote: »

I was in the exact same situation with my credit rating - I had the same amount of missed payments - mine was 2 standing orders I had forgotten about. I moved country, Mum was polite and didn't open my mail. 3 missed payments and the debt was written off by BoI - this was 2011.
Fast forward to this year, I'm trying to apply for a mortgage. 
KBC declined me, using that as the primary factor. Keep in mind I had stellar savings, solid employment history and no missed payments since. It was also for the grand total of 56euro. 
I applied to BoI, supplying the exact same information - my ICB report, my credit card statements from that period. They said it was a "genuine" reason, and I was approved for the mortgage. 
It's the last 24 months before the card was closed. Mine was closed in 2012, and the debt appeared 3 months prior to the closing date. I have to wait until 2017 for the whole thing to be wiped. 
I have spoken to many people about applying for credit through KBC - IMO they definitely aren't the best bank to go through. Don't get distracted by the seemingly lower interest rates - cash back offers are better. You can also switch in a few years (make sure you read your contract- I know it's costly to move, just my own opinion!)

Isnt it actually ridiculous, like €56!!!! Its quite unbelievable i think, for such a measly amount and the rest of your credit rating perfect, and as you said savings were excellent...you really do have to wonder.