In the majority of cases, even if the six year period isn’t up yet, the further in the past something is, the less impact it will have on your credit score and therefore on a lender’s decision. Find out your credit report Adverse credit events stay on a person’s record for six years, after which they are removed. What is my credit rating? Finding our your credit rating is easy. They do this for two reasons to offset what they see as an additional risk and because they know they can, as borrowers with a poor credit rating have fewer options than those with an exemplary record. If the decision isn’t clear cut, they might say ‘yes’, but charge higher fees and/or a higher rate of interest. High street lenders interpret this data in line with their own criteria and arrive at a credit score, based on which they will say ‘yes’ or ‘no’ to a remortgage application. The information gathered from public records includes details of adverse credit events such as CCJs, bankruptcies and IVAs, plus information held on the electoral roll. Lending companies share information including how much a customer is in debt to them, how promptly they pay their bills, and if they pay in full, and whether their credit cards are maxed out. They get their information from two main sources: other lending companies that have agreed to share data about their customers, and public records. Can I get a bad credit mortgage? We Can Help Today How does a credit score work? Your credit score is the result of an assessment of financial and other information gathered about you by Experian, Equifax and Callcredit – the three main credit reference agencies that operate in the UK. However, having said that, while each adverse credit event represents a black mark on a person’s credit record and has an impact on their credit score, none of them should be considered an immovable barrier to obtaining a remortgage deal. In truth, most homeowners will be able to obtain a remortgage deal, even with a number of credit issues on their record, such as: Missed or Late Payment Debt Management Plan Discharged Bankruptcy Defaults (a series of missed payments) County Court Judgments (CCJs) Individual Voluntary Arrangement (IVA) Every case is judged upon its own individual merits, which means we can’t guarantee remortgaging with bad credit will be possible. The biggest misconception is that the answer to a bad credit remortgage application will always be a resounding ‘no’. However, as with most things involving finance, there are a number of truths and myths which can become blurred. From a financial standpoint, a history of bad credit or an existing bad credit score is indicative of poor money management skills, and this makes those applicants a high risk for lenders. Check here Why Might Lenders Be Unwilling to Remortgage? Most high street lenders will look upon bad credit remortgage applications in the same way they’d consider, and probably turn down, initial mortgage applications from people with bad credit. Bad credit calculator Find out if you can get a mortgage with our new calculator. To help you understand the situation, let’s first take a look at why lenders might be unwilling to offer you a remortgage deal. There are likely to be options available to you. If you are in this position take heart, as a bad credit score does not necessarily mean that you’ll be unable to remortgage your property. Having an adverse credit score can be an obstacle and present a real challenge to be overcome. Even if they do, the terms they offer might be less favourable than your current deal. As your circumstances have changed, the fact they gave you your initial mortgage is no guarantee they will agree to offer a remortgage deal. However, if you have suffered financial problems since your initial mortgage was obtained, you might find that certain doors are now closed to you, and that might include the door to your current lender. You can often also obtain a better deal at the same time, making it a win-win situation. Remortgage with Bad Credit If you are a homeowner and need to raise cash for something – for example, a new car, a holiday or home renovations – a remortgage is an excellent method of releasing capital in an existing property.
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