Bad Credit Remortgage

Bad Credit Remortgage

If you’ve got a mortgage you might be able to make huge savings each month by remortgaging, even if you’ve got bad credit

We’ve helped hundreds of customers like you find a bad credit remortgage product that makes a real difference to their monthly outgoings. Here we’ll cover:
What a remortgage is, and reasons to consider remortgaging
How we helped our customer get a remortgage deal, even with bad credit
Why it’s best to go through a mortgage broker when you’ve got bad credit
Remortgaging could be easier than you might think – what your next steps are

What is a remortgage?

A remortgage is when you take out another mortgage on your home to replace your current mortgage, or to borrow extra money against your property.

You would remortgage a property to either raise or save money:

Raise money

You can raise money by releasing equity in your home and taking out a new mortgage that is larger than your existing one. You could do this to consolidate debts, make home improvements, or fund something else in your life.

Save money

You could save money by remortgaging and switching to a cheaper mortgage provider – making your monthly payments smaller each month. You will need to check the terms of your contract though to make sure you aren’t charged any early exit fees.

As your mortgage is likely to be your largest debt, it makes sense that improving on it can also give you the largest saving – a saving that can add up to thousands of pounds each year.

Exactly how much you could save will depend on several factors, including:

  • How much equity you have in your property
  • What your current deal is like
  • Whether there is a fee for ending your current mortgage deal
  • Whether your home’s value has increased
  • How much your remortgage costs

How we helped one customer by finding a bad credit remortgage:

With Clever Mortgages, Mr and Mrs C were able to:
Get a debt consolidation remortgage, even with a poor credit history Secure a fixed rate of 2.10% Save almost £500 each month on mortgage and debt repayments

 BalancePaymentRateProductTerm
Current Mortgage£61,000£4901.25%Lifetime tracker12 Years
Current Secured Loan £43,000£43610%Standard Variable Rate12 Years
Unsecured debts£44,320£657VariousVariousVarious
New Mortgage£150,000£1097.672.10%5 Year Fixed13 Years

Mr C had been in an IVA, which he’d now completed, and Mrs C was currently in a Debt Management Plan. They wanted to consolidate their secured loan, plus three other debts, into a new mortgage product – hoping that this would bring down their monthly repayments.

At Clever Mortgages we were pleased to be able to help them, and we secured them a new mortgage which is now saving them a significant £485 every month! This is making a real difference to their lives, and helping them get back on track, improving their credit score.

What do I need to know about getting a bad credit remortgage?

Remortgaging can help you to save money every month, and can also be a good way to get a lump sum of money, instead of taking out a personal loan.

As a mortgage is such a large financial commitment, it’s important to give it plenty of consideration – but don’t panic either, our team help customers every day to decide what to do next when it comes to mortgages and their situations. We can help you:

  • Understand different mortgage options, including fixed and variable mortgages
  • Understand also how equity releasing from your property can work
  • Consider any risks, such as whether you can manage the monthly repayments
  • Find out your potential best options for if you did go ahead and remortgage

Next steps for a bad credit remortgage

If you want some expert advice on remortgaging, and what it could mean for you – get in touch with our team today. You can call us on 0800 197 0504, or enquire online.

You can also find lots of advice on all things mortgages, in our Guides and Advice section.

What are the benefits of remortgaging?

A remortgage is when you take out another mortgage on your home to  replace your current mortgage– and we can help you with this, taking all the hassle away from the remortgaging process.

It’s sometimes possible to secure a lower rate, giving you the opportunity to consolidate your debts, whilst saving yourself money every month. Debt consolidation can be a good solution for some mortgage customers – however, it’s not suitable for everyone.

You should always review the total amount payable through consolidation,  not just the immediate savings in terms of a reduced monthly payment. Please be aware that any unsecured debts consolidated within the mortgage, would then be secured against your property.

We’ve helped 1000s of customers to remortgage – and bring their monthly payments down.

Want to remortgage with bad credit?

Worried about bad credit? We work with customers every day who have bad credit but want to remortgage – and we always do what we can to help.

Remortgaging could be easier than you might think – especially when you choose a broker who knows how to get you with the right lender to save you money.

Enquire with us about a remortgage with us, and we could:

A debt consolidation mortgage can help you save money every month – we recently helped Mr C who was nearing the end of his fixed rate deal, to consolidate his secured loan and mortgage into one monthly repayment reduce the mortgage term and save money.

Help get you back on track – being able to consolidate Mr C’s secured loan with a mortgage product meant only having to plan for one monthly payment instead of two, making the overall debt much easier to stay on top of.

Reduce the term of your mortgage – we can often help customers cut years off their mortgage – helping them to become mortgage free far sooner than they thought.

Why should I use a mortgage broker?

You’re likely to only have to do one application – this will save you time, and more applications from being recorded on your credit file

Some mortgages especially for people with bad credit are only available if you go through a mortgage broker

Brokers can advise on what would improve your chances – e.g. finding a guarantor or opting for a joint mortgage

They can take the hassle of application forms away – talking you through every step, and asking all the right questions

What next?

If you are looking for expert advice on remortgaging your property, contact our team today. We will be happy to help advise you on what you on your options.

We are experts in offering solutions to people with bad credit and can help you if you need a helping hand with your next move.

Get a call from a mortgage advisor at a time to suit you,

Debt Consolidation Mortgage

Debt Consolidation Mortgage

Getting a new mortgage to consolidate your debts can be a good way to get your finances back on track. In this guide we’ll cover:

How we helped a customer to save money every month with a debt consolidation mortgage – even with poor credit history!

A little about the remortgage process with us – it’s easier than you might think

How we could help you – including why it’s best to go through a mortgage broker

How we helped with a debt consolidation mortgage

With Clever Mortgages,  Mr C was able to:

Reduce his mortgage term Cut the interest rate  Save overall £124.42 per month.

 BalancePaymentRateProductTerm
Current Mortgage£75,263£635.922.29%2 Year Fixed Rate10 Years 9 Months
Current Secured Loan£48,169£637.598.68%Variable10 years 9 months
New Mortgage£123,435£1149.092.24%5 Year Fixed10 Years

Mr C had been with his lender for a fixed rate period, and knew he might be able to save money every month if he consolidated a secured loan he had,  with a new mortgage.

His current rate was at 2.29%, which is similar to the new mortgage, but the key was to incorporate in the secured loan which was on a much more costly rate. We were also able to reduce the term by 9 months and saved £124.42 per month.

What are the benefits of remortgaging?

A remortgage is when you take out another mortgage on your home to  replace your current mortgage– and we can help you with this, taking all the hassle away from the remortgaging process.

It’s sometimes possible to secure a lower rate, giving you the opportunity to consolidate your debts, whilst saving yourself money every month. Debt consolidation can be a good solution for some mortgage customers – however, it’s not suitable for everyone.

You should always review the total amount payable through consolidation,  not just the immediate savings in terms of a reduced monthly payment. Please be aware that any unsecured debts consolidated within the mortgage, would then be secured against your property.

We’ve helped 1000s of customers to remortgage – and bring their monthly payments down.

Want to remortgage with bad credit?

Worried about bad credit? We work with customers every day who have bad credit but want to remortgage – and we always do what we can to help.

Remortgaging could be easier than you might think – especially when you choose a broker who knows how to get you with the right lender to save you money.

Enquire with us about a remortgage with us, and we could:

A debt consolidation mortgage can help you save money every month – we recently helped Mr C who was nearing the end of his fixed rate deal, to consolidate his secured loan and mortgage into one monthly repayment reduce the mortgage term and save money.

Help get you back on track – being able to consolidate Mr C’s secured loan with a mortgage product meant only having to plan for one monthly payment instead of two, making the overall debt much easier to stay on top of.

Reduce the term of your mortgage – we can often help customers cut years off their mortgage – helping them to become mortgage free far sooner than they thought.

Why should I use a mortgage broker?

You’re likely to only have to do one application – this will save you time, and more applications from being recorded on your credit file

Some mortgages especially for people with bad credit are only available if you go through a mortgage broker

Brokers can advise on what would improve your chances – e.g. finding a guarantor or opting for a joint mortgage

They can take the hassle of application forms away – talking you through every step, and asking all the right questions

What next?

If you are looking for expert advice on remortgaging your property, contact our team today. We will be happy to help advise you on what you on your options.

We are experts in offering solutions to people with bad credit and can help you if you need a helping hand with your next move.

Get a call from a mortgage advisor at a time to suit you,

We can help you remortgage even with bad credit

We can help you remortgage even if you have bad credit

If you have bad credit and need to remortgage your home, then don’t worry as we should be able to help. We understand there can be lots of reasons for people having an impaired credit profile and will look into your circumstances to make sure you’re offered the most suitable solution.

Continue reading “We can help you remortgage even with bad credit”

The Best Ways To Fund Your Home Improvements

There’s a good chance that once you’re on the property ladder, you will want to put your own stamp on your house by making some home improvements. You might want a new kitchen or build an extension, whatever you want to do, you’ll most likely need to raise some capital in order to do it.

The best ways to fund your home improvements

In order to afford the improvements, or perhaps protect our savings, most of us will have to use some form of borrowing, but it can be difficult to establish the best option for you. The most popular options for funding home improvements are remortgaging or a home improvement second charge secured loan, but you can work out what is the best option for you.

Remortgaging or taking out a loan

There is a multitude of options available when it comes to funding your home improvements, you just need to decide which one is the best for you. It’s important to remember that when it comes to borrowing money against your home, if you don’t keep up the regular repayments, you could lose your home and it’s vital to bear this in mind when considering remortgages or a second mortgage.

Remortgage to fund home improvements

During the process of paying off your mortgage, it’s likely that you will have a substantial amount of equity tied up in the value of your property. A remortgage is a process of taking out another mortgage on your home, to replace your current mortgage or to borrow money against your property.

For example, if your existing mortgage has £150,000 outstanding and you want £20,000 for home improvements, you may be able to find a mortgage lender willing to lend you £170,000 which can be used to pay off the existing mortgage and fund the work on your home. It’s important to remember that in doing so, you would be increasing the amount of borrowing that is secured against your home and you’ll also need to make higher repayments over the full term of your mortgage. How high the repayments of your mortgage will be, is largely dependent on what proportion of your property value the mortgage represents, your Loan to Value (LTV) and other fees associated with remortgaging.

When remortgaging might not be the best option

Remortgaging a property might work well for some, but it may not be the best option for everyone, especially if:

-Your mortgage debt is small
-Your repayment charge is large
-You have little equity in the property
-Your home’s value has dropped

Second charge secured loan

A second charge secured loan is another option available to keep your existing mortgage intact. So rather than approaching your existing lender, you find another lender who is prepared to grant you a second mortgage.

Secured charge loans are aimed at homeowners that are unable to get a personal loan elsewhere due to a non-existent or bad credit rating. Secured loans also work well for homeowners that are looking to borrow significantly more than an unsecured or personal loan. You would need to make repayments on both mortgages at the same time, which may be over a longer period than a personal loan.

Similar to a further advance, this option also involves increasing the amount of borrowing that is secured against your home and the second charge loan may also be offered at a rate that is much higher than of your first charge mortgage, so it’s best to figure out whether you can afford it or not beforehand.

As your home is used as security for the debt, secured loans may allow you to borrow a larger amount of money with a lower interest rate in comparison to unsecured loans. However, lenders do consider secured loans to be a greater risk to borrowers than an ordinary bank loan.

As a mortgage broker, we specialise in finding great deals on mortgages. We can also compare secured loans from our different lenders to provide you with the most suitable loan.

A further advance from your mortgage lender

You could also get a further advance from your mortgage lender by approaching them and asking if they are prepared to lend you more money. You might do this if your existing mortgage deal is a good one, or if you have significant penalties for terminating your existing mortgage. It’s also important to remember that any advance would be secured against your home and you would still need to pay back the extra money. Also, the interest rate you are charged on the additional borrowing could be different to your existing mortgage rate.

Unsecured loan

If you don’t want to secure any additional borrowing against your home, you can take out an unsecured loan. To obtain an unsecured loan you could try approaching a bank or other lenders. These types of loans typically have repayment terms of up to five years and they also have fixed interest rates so it’s easier for you to plan your budget.

Credit card

If the cost of your home improvements isn’t too high, you could consider paying on your credit card. This could be an attractive option if you can obtain a low-interest rate or even a card with a 0% introductory rate. It’s worth noting however that many of these 0% rates are indeed, introductory. It’s important that you make any repayments before the promotional period ends at the rate subsequently increases.

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How to get the best remortgage deals

For the vast majority of us, our mortgage is the single largest financial commitment we’ll make. Whilst this is the greatest expense we’re likely to see in our lifetime, it also presents the greatest opportunity to make the biggest savings. Remortgaging is the process of switching your current mortgage to a new lender who can offer a better deal.

How to get the best remortgage deals

For the vast majority of us, our mortgage is the single largest financial commitment we’ll make. Whilst this is the greatest expense we’re likely to see in our lifetime, it also presents the greatest opportunity to make the biggest savings. Searching for the best remortgage deals can help you to find a better rate.

Remortgaging is the process of switching your current mortgage to a new lender who can offer a better deal. If you’re looking at remortgaging your property you should consider the following:

Affordability

The most important thing to consider when looking to remortgage is whether you can still afford the monthly payments. Lenders now apply stricter affordability checks than they once did. Some have found them difficult to pass, even for a cheaper deal than they are currently on.

Costs for leaving your current deal

Exit fees – also called a ‘deeds release fee’ or ‘admin charge’ – are a fee that you will usually have to pay for your current lender to forward on your title deeds to your solicitor. If you are leaving your current deal earlier than contracted then you might also be penalised with an Early Repayment Charge (ERC).

New mortgage costs

Even if remortaging results in lower monthly payments you will be required to make payments to take out the new mortgage. Most products require mortgage fees, which includes arrangement fees and a booking fee. Additionally, you will also have to pay a conveyancing fee, a broker fee and a valuation fee. If you’re unsure what these terms mean, referring to our Mortgage Jargon Buster might be useful.

Your credit score

Having a good credit score probably goes without saying when trying to get any kind of mortgage product. Unfortunately, if you’re suffering from bad credit then this isn’t something you can quickly fix. However, there are still mortgage brokers, including Clever Mortgages, who will help find you a remortgage deal if you have bad credit.

If you know you have bad credit then there are a number of ways you can increase your credit score for future borrowing.

The level of equity in your property

Much like a good deposit helps when you’re a first-time buyer, decent equity helps when you’re looking to remortgage. Unlike your deposit, however, the equity in your property will hopefully have grown over time with an increase in property values. This lowers the loan to value (LTV) of what you want to borrow, making you eligible for a better rate.

A valuation of your property can allow you to work out your house price and the level of equity you have within the property. Valuation fees are often included for free as part of your remortgage package, but you should make sure of this beforehand.

Which type of mortgage?

When comparing mortgages you should also look at the different types of mortgage available. Below is a guide to help you decide which option is right for you:

Interest-only mortgage These allow you to pay off only the interest on the amount you borrow. At the end of the mortgage term you use your savings or investments to pay off the remaining amount.
Capital repayment mortgage Where you gradually repay the money you have borrowed from your lender with added interest. This is paid back monthly over the mortgage term.
Fixed rate mortgage Where your interest rate stays the same for a set time period (usually between 2-10 years). This means that your repayments are exactly the same each month, regardless of what happens to mortgage rates.
Variable rate mortgage Where the interest rate goes up and down in line with the lenders Standard Variable Rate (SVR). This means that your payments can go up or down depending on the interest rate at that time.
Discount mortgage When a reduction is applied to the lenders Standard Variable Rate (SVR) for a set time period (typically 2-3 years), allowing you to make lower repayments during this time.
Tracker mortgage This is similar to a variable rate mortgage, where the interest rate can fluctuate. Rather than tracking the lenders SVR, they track a nominated interest rate. This is usually the Bank of England interest rate.
Capped mortgage This is the same as a variable rate mortgage but the interest rate can never rise above a set “cap”.
Offset mortgage These mortgages are linked to your savings account as well as your current account. Interest is only payable on your mortgage balance minus any savings balance.

Speak with a mortgage expert

If you need further advice on what you should be aware of when remortgaging, then one of the best options is to speak with a mortgage broker. Request a callback with a member of our team to speak with one of our mortgage advisers.

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What does the interest rate rise mean for you?

There’s been plenty in the news recently about interest rates rising for the first time in over 10 years. The Bank of England has raised the base rate from 0.25% to 0.5%. This means you could be paying roughly £200 more a year for every £100,000 you owe.

What does the interest rate rise mean for you?

There’s been plenty in the news recently about interest rates rising for the first time in over 10 years. The Bank of England has raised the base rate from 0.25% to 0.5%. This means you could be paying roughly £200 more a year for every £100,000 you owe.

Why has the interest rate increased?

The rise in the base rate is an attempt to lower inflation. Inflation is the general increase in prices for goods and services. A higher interest rate often works to reduce inflation as it encourages people to save rather than spend.

What does the interest rate rise mean for your mortgage?

Fixed Rate Mortgages

If you are on a fixed-rate mortgage, nothing will change – for now. However, when the time comes to review your current mortgage deal, there’s a chance your mortgage payments will increase on a like-for-like product. Most fixed rate deals are either 2 or 5 years, so depending on when you started with your current product, you may have some time to consider your options. You can make use of a mortgage calculator to understand what your new repayments will be once your current deal comes to an end.

Variable Rate Mortgages

Those on a variable rate mortgage are at greatest risk of seeing an immediate increase in their monthly mortgage payments; this accounts for around half the mortgaged population. If you’re on a Tracker mortgage, you will definitely see an increase in your payments. As the name suggests, a tracker mortgage ‘tracks’ the base rate and therefore rises and falls with it.

If you’re on a variable rate, it could be time for you to review your mortgage. You can get in touch with an adviser or even start the mortgage application process to make sure you’re on the best deal for you.

What about my savings?

Whilst yes, you will earn more on your savings, don’t expect it to outweigh the increase in your mortgage payments. If you have £10,000 in a cash ISA, you could expect your annual interest to rise by around £25.

Should I do anything?

It may not be a bad idea to get mortgage advice, particularly if you’re on a variable rate mortgage, as there could be a better, cheaper product for you to switch to. Mortgage brokers are often your best port of call. Unlike if you went to an individual lender, they only review their own range of products to find you the best deal.

Clever Mortgages can explore much further. We review an extensive range of options from different lenders to find the one you’re most comfortable with, so you can be sure of staying happy in your home.

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Beginners guide to mortgages

Getting a mortgage is probably the biggest financial commitment you will ever make. But if you’re a first-time buyer, you might not know where to start. Here we have outlined the main things you need to know about getting a mortgage.

Beginners guide to mortgages

Getting a mortgage is probably the biggest financial commitment you will ever make. But if you’re a first-time buyer, you might not know where to start. Here we have outlined the main things you need to know about getting a mortgage.

What is a mortgage?

A mortgage is a large loan used to help buy property or land. This makes up the difference between the total cost of the property and the deposit (lump sum payment). Interest and mortgage fees will be added onto the cost of your mortgage for borrowing the money.

Mortgages are secured against the value of your house until it’s completely paid off. This means that if you fail to keep up with your repayments then your mortgage lender has the right to repossess the property to sell and get their money back.

Do I qualify for a mortgage?

You can get a mortgage if you’re 18 or older and in full-time employment. Most lenders will require that you’re no longer in your work probationary period and that you have a good credit score. However, there are still options available for people who have a poor credit history.

How much can I borrow?

The amount you can borrow is based on your yearly earnings; as well as your partner’s earnings if you’re taking out a joint mortgage. Our online tool can help you work out how much you can borrow if you’re unsure.

No mortgage provider will allow you to take out a mortgage that you can’t afford. The lender will also want to see at least 3 months’ worth of bank statements to determine how much you can borrow for a mortgage.

How big a deposit should I put down?

Although there isn’t a set amount that you have to put down as a deposit, most lenders require around 20% of the house’s value. For example, if you’re looking to purchase a £200,000 house, then you should look to put down a deposit of £20,000.

The bigger the deposit you put down, the cheaper your mortgage repayments will be as you will have a smaller mortgage to pay back.

Consider your LTV (Loan to Value)

A larger deposit will reduce your LTV (Loan to Value), allowing you to get a better deal. Your LTV is the size of your mortgage in relation to how much your property is worth. High LTV mortgages (above 80%) won’t guarantee the best interest rates as these are considered riskier for lenders.

If you’re in a position where you need to secure a high LTV then you’re more likely to get approved if you have good credit score.

How much will I pay each month?

Your monthly repayments will be based on a number of factors. This includes your LTV, the type of mortgage you take out and the length of the term:

Types of mortgages

Fixed rate mortgage – Where the interest rate stays the same for a set period of time, as do your monthly payments.

Variable rate mortgage – Where the interest is set at the lender’s SVR (Standard Variable Rate), considered as their basic mortgage.

Discount mortgage – This is the same as a variable rate mortgage but a reduction is applied for a certain length of time.

Tracker mortgage – This is similar to a variable rate mortgage but instead, they track a nominated interest rate, usually the Bank of England’s interest rate, rather than the lenders SVR.

Capped mortgage – This is also the same as a variable rate mortgage, however, the interest rate can never rise above a set “cap”.

Offset mortgage – These mortgages are linked to a savings account as well as your current account. Each month the lender will look at what you’ve put into savings and deduct this from what you owe on your mortgage.

Whichever type of mortgage you agree to, you will be contracted for a number of years before you are able to renew or remortgage by going elsewhere to get a better deal.

Mortgage term length

On average mortgages run for 25 years, but terms can be longer or shorter than this depending on your situation. As affordability is more prevalent with house prices increasing, many people are choosing mortgages with longer terms in order to get a lower monthly payment.

If affordability isn’t an issue for you then choosing a shorter term could be a better option as you will pay less in interest over time.

If necessary, you can extend or reduce your mortgage term; however, there may be an additional cost to this. You should always ensure that you can afford the change in monthly payments if you choose to change your term.

Applying for a mortgage

The process of applying for a mortgage is relatively straightforward. You will need to provide information about yourself as well as information about the property you are looking to purchase.

When applying for a mortgage you should avoid making multiple applications in a short period of time. This is because lenders will be able to see each of these on your credit file, suggesting that you might be desperate for finance.

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