Bad Credit Mortgage Broker & Advisers – Helping you get a mortgage with bad credit!
There’s a common misconception that mortgage companies will never lend to those with a poor credit history.
While getting a mortgage in today’s market can be tough if you have bad credit, it isn’t impossible. In fact, an increasing number of lenders assess mortgage applications manually and accept these applications which our Bad Credit Mortgage Broker & Advisors are processing.
Though having a credit record that is less than squeaky clean may limit your options, you certainly shouldn’t give up hope of ever purchasing your own property if you have encountered financial difficulties in the past.
There are many of bad credit mortgage lenders who will offer specialist products which are more flexible with criteria.
Even individuals with a history of arrears, defaulted payments, CCJs, IVAs, debt management plans, or bankruptcy within the last six years can be considered by bad credit mortgage lenders.
However, be aware that the deals you’re offered may have higher interest rates initially, as the provider views you as a higher-risk borrower.
But if you keep up your repayments, and take active steps to improve your credit rating, there’s no reason why you can’t find yourself in a much better financial position in the months and years to come.
We could even look at moving your from your bad credit mortgage lender to access a much better deal when you eventually come to remortgage your property. Our specialist team assist many adverse credit clients every year, so you’re in safe hands.
We are able to help with the affordability assessment, the full application process, negotiate with lenders and support you throughout, so give us a call today.
Credit Reports & Credit Scores Explained
Technically, there’s no such thing as a general ‘bad credit’ score. Credit scores in the UK are calculated differently by the main credit file reference agencies: Experian, Equifax, and TransUnion. Each agency provides a unique report and numerical score based on its own system, which is unrelated to the others.
Making broad comparisons between them is challenging, as one company may use outdated or unconsidered information.. The view of any score will also vary according to which lender is looking at it, as some lenders will interpret scoring in different ways to others.
Any adverse credit issues themselves that will make a huge difference. Sadly, some lenders will view the slightest fault on your credit history – such as a late payment on a utility bill, or a missed credit card instalment – as being indicative of poor money management, and will consider you a higher risk.
To help companies make better lending decisions, the three main credit agencies listed above will analyse all your credit data to calculate your overall credit rating. They will assign you a score between 300 and 999, and it is this score that will help lenders determine what kind of borrower you are.
The lower the score, the higher the risk to a lender, this is where bad credit mortgage lenders come into their own, there will not just go by the face value of your credit report, they will look into why your credit is the way it is.
Check your credit score today!
Each credit reference agency calculates your credit rating slightly differently and has a different scoring system. Which means that what counts as a good credit score will depend on which of the four major agencies your lender uses.
Experian, Equifax, Crediva and TransUnion, each credit agency could have different information showing, therefore, we have teamed up with Check My File. Their services provide not only a free 30-day trial but also a comprehensive credit report from all four agencies. This ensures our mortgage advisors can easily identify any credit rating issues.
To obtain your report, click the link below for a 30-day free trial with CheckMyFile. After the trial, a monthly subscription fee of £14.99 will apply, with the flexibility to cancel anytime.
Provide us with a credit report today, and uncover the issues that could be affecting your credit file! CLICK HERE to access your free credit report with the four top credit agencies all in one report!
What is a specialist bad credit mortgage?
There is no such thing as a bad credit mortgage. It’s simply a term used to describe the kinds of mortgages for which you are likely to be approved if you have a bad, or poor, credit rating. A lender who deals with bad credit are usually a specialist niche-market lending companies.
While still operating under the same rules and regulations as the mainstream providers, so your rights and your home are no less protected, they use far more flexible criteria, consider all kinds of situations and adopt a realistic approach to each applicant’s case.
How to get a mortgage with poor credit…
If you have a bad, or poor credit score and need to apply for a mortgage, the first thing you will need to do is check your credit score so you understand where you are starting from and what lenders will see when they run your credit report.
You could find that your score isn’t as bad as you thought, and you are eligible for a standard mortgage or you may find errors on your report that need correcting, resulting in an improved credit score without you having to do anything.
Next, you need to create a budget that includes all your income and expenditure. Be honest with yourself here because otherwise you risk thinking that you can afford larger mortgage repayments than you actually can. Include everything you spend money on, down to the coffee you buy yourself on the way to work in the morning. Once you know how much you spend each month, you will have a realistic idea as to what you can afford to spend each month on a mortgage.
Use this figure to start looking at potential mortgages and mortgage lenders. This is a ideal time to give us a call. One of our experienced advisors will go through your finances with you, helping you to work out which mortgages you can apply for and the size of deposit you’ll need. If you aren’t ready to speak to us yet, we have a really useful mortgage calculator on our site that’s free for you to use.
To avoid negatively impacting your credit score and approval chances, steer clear of hard credit searches. When applying, focus on mortgages you’re likely to be approved for. Remember, having bad credit doesn’t guarantee lender acceptance. For the best shot at approval and a mortgage, consult a bad credit mortgage broker. Even if they can’t find a mortgage currently, they can guide you on credit score improvement, accessing your credit report, handling late payments or credit issues, and getting on the electoral roll.
The Benefits of Working with Alexander Southwell
- Expert Mortgage Advisor – Our in-depth expertise and vast experience of financial services will ensure we offer a unique total solution to our clients.
- Mortgage Rates – This includes knowing the types of mortgages that are available. This includes the bad credit mortgage sector, and the type of lenders that would be willing to take a risk on a borrower with bad credit. At Alexander Southwell Mortgage Services, we have access to thousands of bad credit mortgages and exclusive specialist mortgage products not available on the high street.
- Time saving & Hassle Free – our specialist mortgage advisers can save you time and money by offering related financial advice. This may include helping you find buildings and content insurance for your new home or other types of insurance which could reduce the risk of your losing your home if you can’t make repayments, for example, critical illness, life insurance and income protection insurance.
Frequently asked questions – Bad Credit Mortgage Broker
Will my monthly payments be higher due to my poor credit?
When you are approved for a bad credit mortgage, you will be expected to make monthly repayments of an agreed amount. It’s important that you make these repayments, on time, every month. Make sure you stick to your budget so that the money earmarked for mortgage payments is always available.
We can help you budget to make sure you keep up repayments to your mortgage lender. It’s impossible to give an exact figure for how much more than a conventional residential mortgage a bad credit mortgage will cost. The main factor to drive down the cost of the mortgage will be a high deposit therefore allowing the lender to offer you slightly better interest rates.
What deposit will specialist lenders ask for when applying for a mortgage?
A lender lending 75% of the property value carries less risk than one lending 95% due to the possibility of repossession.
Repossession occurs when a property is seized and sold by the lender due to mortgage non-compliance, including missed payments.
When a lender sells a property, it often goes to auction for a quick sale, but this may result in a lower market value. Deposits play a crucial role in managing risk, as higher deposits mitigate potential issues.
For minor credit issues that occurred years ago, some lenders may consider loan-to-value (LTV) ratios between 90% and 95%.
However, more severe marks like IVAs, late payments, repossession orders, or bankruptcy notices within the last 3 years may require a deposit closer to 25%.
Does being married to somebody with adverse credit give you a bad credit history?
Marriage to someone with bad credit doesn’t automatically mean you’ll have bad credit. However, joint financial accounts create a connection that can impact the other person’s credit history and perception by lenders. Applying for credit with a partner who has bad credit may lead to a higher rate or even a declined application.
Can I get a mortgage if I’m on a debt management plan (DMP)?
You need to bear in mind that if you are planning to get a mortgage on a debt management plan.
Your borrowing capacity is determined by your income multiples and credit history, which can be affected.
Individuals with a clean credit file and no debt management plan (DMP) may secure up to five times their income. However, those on a DMP might be offered four times or even less of their total income.
Can I remortgage with bad credit?
You can access a better range of interest rates by settling as many of your outstanding debts as possible before your mortgage is up for renewal. Don’t let concerns about your bad credit history or limited credit activity hinder your chances of securing good terms for remortgaging.
Speak to us here at Alexander Southwell well before your existing term is due to end and we can provide you with expert advice.
Bad Credit Mortgage Broker & Advisors
Our specialist bad credit mortgage brokers understand the obstacles you’re facing. But perhaps more importantly, they have the knowledge, the experience and the contacts to greatly improve your chances of finding a mortgage that will support your longer term goals.
We have access to an extensive panel of lenders, which means we can source mortgage offers from niche lenders with more flexible eligibility criteria than many of the high street banks.
Contact us today to book your fee free, no-obligation consultation at a time that suits you. Evening and weekend appointments are available.