Adverse Credit Mortgages

If you think you might need an adverse credit mortgage, then it's best to get some information about what an adverse credit mortgage really is and who it might be suitable for. Here's what you need to know about the adverse credit mortgage.

Adverse mortgages are known by many names, depending on the lender. Within the mortgage trade they may be known as non-conforming or sub-prime mortgages, in contrast with the standard mortgages for people with no credit problems. You will also hear an adverse credit mortgage called a credit impaired mortgage, a non status mortgage, a bad credit mortgage or a non standard mortgage. Whatever they are called they all indicate the same kind of mortgage product - a mortgage that was designed for people with impaired credit.

But what exactly does impaired credit mean when it comes to the adverse credit mortgage? If you are applying for an adverse credit mortgage, the chances are that you will have previous mortgage arrears or rent arrears in your credit history. You may have had County Court judgements (CCJs) entered against you. You may have entered into an individual voluntary arrangement (IVA) as thousands of people are doing now, or your credit history may include bankruptcy.

Getting An Adverse Credit Mortgage
There is also another group of people who qualify for an adverse credit mortgage. If you are self employed, self cert mortgages may be the only possible way for you to obtain a mortgage for your home, and this type of mortgage is often considered under the same banner as the adverse credit mortgage.

So where can you get an adverse credit mortgage? Well, there are a lot of lenders who specialise in this area, including Kensington, GMAC-RFC, Platofrm, Amber, SPML, I Group and DB Mortgages to name a few. Depending on your credit history you may not need to go to a specialist lender at all. A couple of CCJs for small debts may well be accepted by a mainstream lender; anything more and a bad credit mortgage loan lender is your best bet. A professional mortgage broker will help to identify whether you need an adverse credit mortgage. After requesting a copy of your credit file from Experian, Equifax or My Call Credit they will be able to place you with the most competitive lender that matches your credit file, income, outgongs and unsecured borrowings.

If you have applied for an adverse credit mortgage, you should expect the interest rate to be higher than for a standard mortgage. The loading applied by the bad credit mortgage company will depend on the level of bad credit. So a couple of arrears and CCJs will be penalised less than if there is also a bankruptcy or IVA in the credit history. With an adverse credit mortgage, borrowers should expect to pay at least one per cent more than the standard rate offered for standard mortgages, but the loading can be several percentage points.

The good news is that an adverse credit mortgage can help you repair your credit history if you manage it properly. A good record of prompt payments will mean that your credit history looks much better within a couple of years. Some people also take the chance to consolidate their debts so that there are no other negatives on the credit report. So if your credit history is less than perfect, consider getting an adverse credit mortgage.

If you have a prime mortgage with a high street lender and have since built up some form of adverse credit, it may be better to take out a secured loan if you are looking to capital raise. This way the mortgage can stay with a prime lender and you only pay a premium rate on the capital raised. The secured loan can pay off what has caused the adverse credit so that in time you can refinance to one payment with a high street lender at prime rates.

Here are some more detailed types of adverse credit mortgage, simply click on each for more information:

adverse credit remortgage - bad credit remortgage - non-conforming mortgage

non-conformiong remortgage - sub-prime mortgage - sub-prime remortgage

remortgage with adverse credit - poor credit remortgage - non-status remortgage

fast adverse mortgage - fast adverse remortgage