What happens if you are unlucky to have a poor credit history – but it is not really bad, just the result of a couple of unlucky breaks?
There is a category of lenders specialising in this market too, offering “light adverse” and “credit repair” mortgages. Here, the borrower is given an incentive to make a big effort to stay “clean” by being rewarded if he or she maintains a 100% credit record once the new mortgage or remortgage starts.
This usually takes the form of successive stepped reductions in the rate of interest payable over the first few years of the loan. The advantage of light adverse credit mortgages is that because they are designed for people with less than severe credit problems, the risk to the lender is lower, so the loan-to-value can be higher and the interest rate can be better too.
So if your credit isn’t that bad but maybe you are not on the electoral roll (making it difficult to check where they have lived in the past for credit check purposes). Perhaps you have several different small paying jobs rather than one normal one, or very minor CCJs or ones that are soon to be removed (within one to three months) from a borrower’s credit record following a long spell of good payment records.
When you have very bad or just light credit problems using a mortgage broker can be a big advantage. It saves you wasting time applying to the wrong lenders. A good mortgage broker will know whom to approach on your behalf so as to reduce the chance of wasting time and money. Always tell the broker the true details of your financial circumstances, don’t forget they are on your side.
Keeping things hidden or not disclosing the full details will not help your cause and could mean they approach a lender they wouldn’t have if they’d been in possession of the full facts in the first place. If after applying for the mortgage or remortgage the lender finds out that you have lied, you will not get the mortgage and you may even face further action, depending on how far you get with your application or even mortgage repayments before the truth comes out.
As long as you can show that the reasons for the earlier defaults were due to reasonable circumstances, then you should still be able to secure the mortgage you want.
At MortgageMap we do not arrange mortgages for anyone though if you would like to talk to an expert bad credit mortgage broker, we can arrange that for you.
Mortgage Calculator
LIGHT ADVERSE