How to Help Yourself
There are plenty of practical steps you can take to meet the challenge of finding a mortgage when you have an adverse credit rating.
- Remember that every credit search leaves a footprint. Too many searches can be seen as detrimental to a mortgage application. At mortgagesplease, we know the lending criteria of each lender and can avoid applying for the wrong mortgage or to the “wrong” lender for your needs.
- Contact a mortgage broker such as mortgagesplease. In our case, not only do we have access to a wide range of adverse credit mortgage deals from a diverse array of lenders, we also take care to find out from you what your requirements are (with our Fact File) and so are able to work out an excellent arrangement on your behalf.
- With our help, you can choose the most appropriate product. One of the most important decisions to make when selecting a mortgage – adverse credit deal or not - is whether to opt for a fixed rate, a variable rate, a flexible deal and so on. We can advise you every step of the way on whether to choose the security of a fixed rate (we can help you with budgeting should not be particularly financially disciplined) or a discounted variable rate (which may offer lower repayments to start with, but is more risky).
- Repair your credit rating: after three years with an adverse credit mortgage, paying a slightly punitive interest rate, your bad credit rating should have been restored to good health. Now is the time to consider remortgaging – changing your mortgage arrangement to your advantage back to a standard mortgage.
- We do not necessarily immediately put you in touch with specialist adverse credit lenders. Quite often mainstream mortgage lenders are prepared to accept an application that is properly prepared – and will generally offer you a lower interest rate than a bad credit mortgage lender
- Most High Street mortgage lenders catering for the mainstream market also have a subsidiary or affiliated company that deals with bad credit mortgages. If a High Street lender rejects your application, it may then refer you to its subsidiary. At mortgagesplease, we are well aware that the adverse credit mortgage market is highly competitive these days and a regular lender’s own subsidiary may not offer the best deals, so we always shop around carefully on your behalf.
- Obtain a copy of your credit file. If you provide us (at mortgagesplease) with a copy of this file, we can determine which lenders to consider. It is important that you do not apply to a lender until you can be certain there is a good chance of the application succeeding (the more searches, the worse your credit score and the higher the interest rate is likely to be).
- Always disclose to a lender details of any adverse credit against you. The lender will find out when they do your credit search and if you have not told them, this amounts to “non-disclosure” and will count against you.
Some lenders specialise in lending to people with adverse credit. In fact, they will lend to anyone with a pulse except, possibly, a bankrupt. However, the interest rate they charge will depend on how bad the credit actually is.
At mortgagesplease we ensure that you know up front how much you will have to pay for the services involved and work hard to minimise them. In contrast, a specialist lender may want to charge extra fees and demand a bigger deposit.
