BAD CREDIT MORTGAGE GUIDE
Find out exactly what’s out there for you
Many people are not lucky enough to sail through life without some monetary set backs, so if you have got a poor credit rating, or only a very small deposit to kick start your property purchase, you are not alone. It’s no secret that the financial climate now makes it much more difficult for some groups of individuals to obtain the credit required for a mortgage. People with a poor credit history, or low deposit find it particularly hard and in many cases believe that renting might be their only option, but this is not always the case.
So, how can we help? At Tailored Money, we think the most important thing is for both the borrower and the lender to be frank and open about everything. If you have had financial troubles in the past it can often feel like you are being judged, rather than having an honest conversation about what is a possibility for your future. Whilst there are no doubts that the criteria for you to secure a mortgage will be strict, there are still options available out there, and if any of them work for your circumstances, we will work hard to find it.
If we can find you a mortgage we will, and our fast and simple process makes it a pain free experience. Our expert loan brokers will search a panel of specialist lenders, sourcing the best deal all whilst considering your history, current situation and any other requirements. With market leading knowledge in this specialist area, our brokers will be certain to lay out clearly what the exact terms and conditions will mean for your circumstances and what a repayment plan would look like. Alternatively you can also remortgage with bad credit which is an alternative way to raise funds.
Generally speaking, the main reason that a mortgage application is declined is because the individual has a poor credit history. A lender checking an application will be looking for any adverse information that might add risk to the application, such as CCJ’s, unpaid loans, missed payments, or low financial security in the form of a deposit. Whilst these types of arrears can lead to a person being declined, this is where we can help. We will work with each applicant on an individual basis and ensure they are judged on their own current financial circumstances, which will allow us to secure the most appropriate mortgage offer we can for that persons future property.
Strictly speaking, bad credit mortgages don’t really exist, really it is just the same as a standard mortgage, but when adverse credit plays its part, the lender will unsurprisingly deem the person borrowing as higher risk and that will be evident in the terms and conditions.
Key things to know and consider about adverse credit mortgages:
Interest rates are likely to be higher.
It isn’t sensible to get a bad credit loan if you already have existing debts – this could leave you in more difficulty.
It’s vital to assess carefully the affordability of the loan and make sure this works within a monthly budget.
The risks are high, missed payments mean you could lose your home.
Whatever your situation, good or bad, a mortgage is a big commitment, and one that needs to be taken seriously as the consequences are high if you fail to keep up with the payments. We continually remind our customers that when applying for an adverse credit mortgage, you will need to prove that you earn enough to repay the loan and that you are in a secure enough position financially to meet the payments long term.
Taking on a mortgage can be daunting, but if you are fortunate to secure the loan you need and make sure payments are kept up to date it also provides a great opportunity to work towards restoring poor credit history. We work with all of our customers to ensure the rates offered provide a payment plan for a positive step towards future homeownership.
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