Phone bills could cost youngsters their first home

That’s the warning from a leading mortgage broker to the UK’s mobile-mad population.

David Titmus of The Mortgage Lender, said: “Mobile phone bill defaulters don’t realise that a missed payment is logged in the same way as a missed credit card or loan payment – and considered every bit as serious an issue.”

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Buying a property may seem a very distant concept for 18-24 year olds because house prices are currently so expensive, however, there is every sign that new Government policy means affordable housing is on the way – but these young homebuyers may well miss out because they won’t be able to get a mortgage.

While it is considered acceptable to chop and change between mobile phone companies, some people believe it is also acceptable to not pay outstanding mobile bills when they do.

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Titmus said: “A County Court Judgement (CCJ) can be recorded against their name without them even knowing about it because of a small unpaid mobile phone bill, for example, or outstanding student loan – in many cases, purely because the company has been unable to make contact to arrange settlement because of change of address. Only when an application for credit is made and refused does the matter come to light.

“Because a mobile phone company is not a bank or mortgage lender, subscribers do not always take payment demands seriously – but contract mobile phones are precisely that: contracts. You break the contract, you’re in trouble.”

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If you miss three mobile phone payments then you’re in exactly the same position as though you’d defaulted on credit card repayments: it stays on your credit history for six years, and mainstream mortgage lenders do not like that.

And Titmus stated that in this day and age, a mainstream lender will be looking for any reason to decline a mortgage application.