With lenders tightening lending criteria thanks to the recent recession, many people find themselves unable to obtain a mortgage due to some adverse credit information on their credit history file.
Those with a poor credit score, the self-employed with variable cashflow and the young are particularly hard hit by lenders’ rigid rules and often see renting as their only alternative to buying a property.
One of the main reasons a mortgage application is rejected is because of the applicant’s credit history. When considering an application, the lender first checks the applicant’s credit file with credit reference agencies such as Experian & Equifax. This allows the lender to judge the potential risk of lending to a candidate. If there is any adverse information on the credit check, such as missed payments, CCJs, defaults or unpaid loans and credit cards, then this makes the applicant a higher risk for the lender. This might then lead to a refused application or a higher interest rate.
After a rejected application, a record of the search is visible on the credit file, this becomes a vicious circle as this itself is viewed unfavourably by many lenders and leads to further rejections.
However, even in the current financial climate, our close links & experience within the mortgage industry enables us to source mortgage facilities for people who have had some historical bad credit. The lenders take the view that some people are generally good with their finances but have had one or two problems with late payments – or have made a stable recovery from bankruptcy – and fall foul of the automated procedures at the High Street Mortgage Lenders. These specialised lenders will judge an application on its individual merits.
If we feel we can assist in obtaining a mortgage for you with some historical bad credit, this will normally take the same amount of time as it would processing an ordinary mortgage & would be underwritten in the same way. From time to time, depending on the lending company, additional supporting information to demonstrate the fact that your finances are now back on track may be required.
When we have been successful in obtaining mortgages for clients who have had historical poor credit, and providing all future commitments are met going forward, we find often this improves the clients credit file and as a consequence may well increase that particular applicants chances of obtaining a High Street mortgage at a future time. However as always we can never guarantee that that would be the case as market conditions and lenders attitudes to market conditions change so frequently.
We can obtain a Decision In Principle within hours for you.
Complete our full Factfind document [download] and email it back to us at Martlandmortgages.com
We will then match your needs to the most appropriate lender & contact you with details of rates and fees once we have a Yes! Decision in Principle from a lender.
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