Adverse Credit Mortgages - Mortgage Advice

Can you get mortgages if you suffer from Adverse Credit with loan lenders?

Over a million mortgage applications are rejected each year. It is thus quite easy for you to find that you have had your mortgage application rejected. This could be because two years ago you forgot to make a monthly payment for the record club you belong to. Well, that innocuous mistake found itself onto your credit record, and looks worse because a record club payment is probably a small amount. A fall in your credit rating can mean you are turned down for a mortgage, and unlike many other factors in your mortgage application, you cannot hide and adverse credit history.

At the moment, someone with adverse credit has only the sub-prime mortgage market to turn to, and that is extremely expensive, with the possibility of having to pay up to 12%. you should be particularly vulnerable.

Over 3 million people in Britain have a County Court Judgement (CCJ) on their credit record. Added to this, over 2 million people have had mortgage arrears at some point. In the past people with adverse credit would be marginalized and forced to pay high interest for a mortgage. Now, however, mainstream lenders are giving serious consideration to more and more people with adverse credit.

The best way for you to get what you need from a mainstream lender is to be honest and upfront about your past. It will actually help you if you tell the lender why you got into credit problems. The lender will want to see that you understand how it happened so that there is more chance for it not to happen again. Adverse credit can be caused by on-off problems like an illness stopping you working which you don't suffer from now. Yes the past matters, but the future is what the lender needs to know about, and that is how they set their rates and their acceptance criteria.

Should a mainstream lender turn you down, try an independent mortgage broker, who can exert some influence over mainstream lenders, as they introduce a large amount of customers to them. Brokers also search all over the market to help you find a mainstream lender you may not have thought of.

A sub-prime lender could be expensive, but it is a step in the right direction, as should you make good on your payments for about 3 years, your credit record will improve and you can apply to a mainstream lender again.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

© AskFinancially.com 2008

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