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Poor Credit Mortgages

It is no secret that our current economic climate has made it more financially challenging for many people. It has also made it very difficult for individuals to obtain credit and mortgages. Young people and people with a poor credit history, in particular, are finding it even harder and in many cases believe they are only able to rent, rather than purchase a property.

In the main, the reason why a mortgage is declined is because of the applicant having poor credit history. When a lender considers any type of mortgage application, the first checks made will be the applicants credit file. If there is any adverse information on file, such as County Court Judgements (CCJ’s), any unpaid loans or missed loan payments, this makes the applicant more of a ‘risk’ to a lender. These types of arrears can lead to an application being declined, however, there are alternative solutions available.

When an application is rejected, for whatever reason, a record of this is placed upon the applicants file. As a result this can mean that any further applications are also rejected. Not surprisingly this can leave the applicant feeling they have no other choice than to rent, rather than buy. This is not always the case.

Even in the current climate there are still a limited amount of specialist lenders who deal with mortgages funds for individuals who have some history of bad credit on file. These types of lenders will consider offering a mortgage to applicants who find themselves in this unfortunate situation. Each application is dealt with and judged upon its own circumstances.

Generally speaking someone who suffered issues concerning late payments or bankruptcy can be considered as having a bad credit history, no matter how small a problem. However, if several years later that individual has shown to become more financially consistent they could still be considered for a mortgage.

As with any mortgage application, it is vital to disclose all your financial circumstances and information upfront. Approved expert advisors can review and place clients with the appropriate lenders and/or quickly establish the best mortgage options available.

Placing these adverse mortgages can usually be done in the same amount of time as a typical high street mortgage. In many cases the lender is often inclined to ask for more information about the client, generally looking for information to support the fact that the clients financial situation is now back on track and in good order.

Linear’s Mortgage Advisors are very experienced in assisting clients with previous credit difficulties and are often successful in helping clients with a bad credit history to obtain a mortgage, even if they have previously been declined.

The overall cost for comparison is 4.9% APR. The actual rate available will depend upon your circumstances. Ask for a personalised illustration.

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.