Adverse or Bad Credit? We can help find the mortgage that is right for you
Home Financial (UK) Ltd is one of the UK's leading Adverse and Bad credit mortgage brokers.
When it comes to buying or remortgaging a home some lenders only want to deal with those who have faultless credit histories, perfect work records and adequate deposits. But money problems can affect everyone. Adverse credit problems can be linked to a loan default, county court judgements, late payments or being a discharged bankrupt.
Sometimes people get into debt through no fault of their own and, even if they have been to blame, want to sort things out. Certainly no-one taking out a mortgage wants to see their property repossessed.
However, there is good news in that some lenders are willing to provide adverse credit mortgages. Deals are unlikely to match standard mortgages; lenders in the adverse credit market - which is also sometimes described as 'sub-prime' or 'non-conforming' - may charge higher rates.
Applicants will still need a steady income and possibly may need a larger than typical deposit making up at least 15% or more of the property value.
While the lenders clearly want to keep some degree of separation between their standard and adverse credit divisions, the deals they are offering are less punitive than in the past. Most lenders will also cut the interest rate if borrowers keep up a good payment record. And, after three years, it may be possible to switch to a standard loan.
Your application will be thoroughly vetted and the interest set according to the risk the lender believes you pose. You may also be subject to redemption penalties, but these should cease to apply after three years.
There are some things you can do, which could improve your credit rating and possibly increase your chances of being approved for a bad credit mortgage.
- Make sure you’re on the electoral roll.
- Pay your bills on time and in full.
- Close any credit accounts you don’t use.
- Check your credit report regularly to make sure that all the information is correct. If you notice any errors, contact the relevant lender and ask for them to be corrected.
Remember, doing all of these things is no guarantee that your credit score will have improved enough to be approved for a bad-credit mortgage. It takes time for your credit score to recover if you have been rejected multiple times or missed multiple repayments.
Each mortgage provider will have their own criteria for eligibility, but generally these amendments to your personal finance habits could help improve your score.
The overall cost for comparison is 5.7% APR. The actual rate available will depend upon your circumstances. Ask for a personalised illustration. Your home may be repossessed if you do not keep up repayments on your mortgage.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE