At Mortgage Success we tend to specialise in helping people who have bad credit to get a mortgage. That in itself should tell you that there are potentially options out there, otherwise we would be out of business.
This article will explain how we can help you to get a mortgage with bad credit in the background.
Age of your bad credit
It is hard to say there is a single deciding factor when it comes to bad credit, but I think there are 2 things. The first is the age of your adverse markers.
5 months and you are likely to struggle, 5 years and it becomes a whole lot easier.
One of the reasons we ask for a copy of your credit report is to understand whether your adverse came from. Was it all from a particular point in time or if it was stretched over a longer period. Its not a deal breaker necessarily in either event but it can affect your options.
It is important to understand when the adverse came about. The more recent it is is going to have an impact on the lenders and products.
What adverse you have
This comes in 2 aspects:
What type of adverse you have. Are we talking late payments, defaults and CCJs, a Debt Management Plan (DMP) or bankruptcy/IVA?
How much adverse you have. Again, are we talking a one of £20 default from a mobile phone bill or are we talking 16 defaults, 2 CCJs and an IVA?
How will this effect me getting a mortgage?
When looking at how to get a mortgage with bad credit the things above all play a major part in getting one. A one off default for a £20 mobile phone bill 5 years ago is going to be viewed very different to a handful of defaults 2 months ago.
That means when applying for a mortgage we need to understand “what and when”. What you have registered and when it was registered. With those 2 things we can normally be very accurate in letting you know your options very early in the process.
Obviously other things come in to play – the size of your deposit for example. The larger the deposit the more options. Where your deposit came from can also affect things. If you saved your deposit, that might help us if your adverse is minor as it can help to get you a high street mortgage compared to a gifted deposit. Your income and debt levels will also play a part with some lenders. With over 80 lenders on panel, trying to get a mortgage with bad credit should be feasible for most… It is, we make a living out of it! But the devil is very much in the detail.
Summary
When looking at how to get a mortgage with bad credit, I think it is quite important to get a copy of your credit report and to speak to a broker. How you go about get a mortgage with bad credit will vary with your circumstances. Minor and historic, you would like to think a broker would be looking at a high street lender. More recent or all contained in a short space of time we might be able to look at building societies who can take a personal view. However if it is more recent or there is a lot of adverse then we might need to look at the specialist lenders.
However I say this to everyone, call us and have the conversation. If we say we cant help you are no worse off than not making the call.
We always aim to at the very least point you in the right direction. That may be a case of saying it will be 6-12 months down the line. But I can guarantee you we will have seen worse or something very similar. The 16 defaults and 2 CCJs example was a real life case!