Tag: bad credit

Mortgages, even with bad credit

Posted on | by Neil Alexander

Poor credit ratings can be a huge barrier when trying to get a mortgage. Luckily there are brokers such as Clever Mortgages who can help you secure a bad credit mortgage when you are looking at buying a house.

We have help 1000’s of customers, just like you with bad credit, achieve cheaper mortgage payments.

Even if you have bad credit, you could still get a better deal on your mortgage. Remortgaging could be easier than you might think – especially when you choose a broker who knows how to save you money. Read below why we think we can help you and your current situation, see some case studies and then contact us for a friendly no obligation chat.

Enquire about a mortgage with Clever Mortgages and we could:

  • Save money every month by consolidating your debts* – we recently helped Mr D, who was coming to the end of his fixed rate mortgage, to consolidate his secured loan and mortgage into one more affordable monthly repayment and reduce his mortgage term in the process.
  • Take years off the term of your mortgage – we helped Mr B cut how long he’d have to pay his mortgage back over by 9 years. By consolidating a loan and a mortgage into one mortgage product, and applying as a sole owner rather than a joint mortgage – we knew we’d be able to save him years of mortgage repayments – saving him thousands of pounds.
  • Help you to get back on track – when Mrs R came to us they were on a far higher than average variable rate and trying to stay on top of their partner’s debt management plan. With the remortgage deal on a far better rate (from 5.74% to 2.1%), they were able to save money each month, and reduce the term of the mortgage – they’re now able to clear the plan and pay less each month.

Case study – over £50,000 saved in mortgage interest.

As well as over £50,000 saved in mortgage interest, Clever Mortgages also saved 7 years off the mortgage term

 BalancePaymentRateTermTotal amount payableInterest Payable
Current Mortgage£145,723£869.205.03%24 Years£252,068£106,345
New Mortgage£167,499£946.941.73%17 years£221,410£53,911

Mrs C had been with her existing lender for many years, keeping up with her repayments, however the lender no longer offered new products. Mrs C had just finished a 6 year IVA and wanted to raise money for much needed home improvements and get a new mortgage rate, Mrs C thought she was stuck on the lenders high standard variable rate.

Mrs C contacted Clever Mortgages, who were able to find a new lender with a much better fixed interest rate, reduced the mortgage term by 7 years, which will save £52,434 in interest over the term. Money was also raised to complete the home improvements.

We help customers just like you every day to find a mortgage that saves them cash and helps them to take control of their finances.

See if we can help you

What should I do next?

  • Speak us today for no obligation advice
  • One of our experts will call for a chat to find out more about what you’re looking for
  • We do all the hard work for you – we’ll find the right deal for you
  • Our expert will keep you in the loop all the way to completion

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

In the above example, the client had both a poor credit history and low credit score. Any savings are dependent on the type of mortgage and personal circumstances.

Why is your credit score important when you apply for a mortgage and how can you help?

When you apply for a mortgage, the lender will assess your application and review your credit score according to their criteria. Different lenders have their own criteria guidelines, so there are often things that’d cause your application to be declined by one, but not by another.

To assess whether they’re prepared to give you a loan, lenders look at information on your credit report such as:

  • Whether you’ve made late payments for bills and loans
  • Any details of debt management plans you have taken out
  • Other details, such as any financial connections with others you’ve had – for instance partners you’ve held joint accounts with

The most recent information will be deemed the most important. Details around debt and credit are usually erased within six years.

Credit scores are important – but whatever your situation, we might be able to help – just get in touch and let’s see how we could help.

* Debt consolidation is 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.

See if we can help you

Getting a bad credit mortgage

Posted on | by Neil Alexander

Many people, understandably, think that getting a mortgage with bad credit is an impossible feat. A bad credit rating can be like a constant weight around your neck, often unfairly, and doesn’t present an accurate picture of you as an individual. Sure, you might have a bad credit rating, but there may have been a variety of factors out of your control which caused you to get that credit rating in the first place.

You might have missed out on a credit card payment because you had to pay for emergency repairs to your car, for example. Similarly, you could’ve had a CCJ awarded against you for some reason or another and your credit score hasn’t recovered since. You could have even had serious health problems or gone through an addiction, and gone bankrupt as a result.

Your average mortgage lender, of course, won’t see any of this. They’ll only see a number on a screen telling them not to give you a mortgage. It’s because of this that getting a mortgage with bad credit can be a difficult thing to do, but that doesn’t make it impossible.

Speak to an advisor

Will I have to get a bad credit mortgage?

There’s no such thing as a bad credit mortgage. This is a common misconception – you’ll still be able to get a standard mortgage, but they’ll most likely have higher interest rates or extra charges, hence the term ‘bad credit mortgage’. They’re also known as ‘adverse credit mortgages’ or ‘subprime mortgages’.

The good news is that after a few years of paying back a bad credit mortgage your credit rating will have repaired itself to some degree due to your payments towards it (as long as they’re on time!). This means that you could move onto a better mortgage that has a lower interest rate in a few years, so don’t worry about being stuck on a bad credit mortgage forever.

So, can I get a mortgage with bad credit?

Yes. You’ll still be able to get a mortgage, but at the same time you’ll have to accept the fact that not every lender is going to be itching to give you one. Some high street banks might be averse to lending to you, but if you scout around enough then you’ll be able to find a lender who’ll look past your credit score and

Be careful when you actually apply for a mortgage too – if you’re rejected when applying for a mortgage this will only further negatively affect your credit rating, making it less likely you’ll be accepted for a so-called bad credit mortgage.

Couldn’t I just improve my credit score?

If you’re set against getting a bad credit mortgage, then there’s always the alternative of simply improving your credit score and then applying for a mortgage from one of the more popular, high street lenders. You can do this by paying off debts you owe on your credit cards, keeping your outstanding balances low and making payments for things such as rent on time.

This is, of course, a lot easier said than done. You might not be in a position to simply pay back debts that you owe just yet, and if you’ve got negative marks on your file such as CCJ’s or bankruptcies then these will remain on your file for at least six years – a time period you aren’t likely to want to wait if you’re looking for mortgages now.

Getting a mortgage with bad credit sounds a lot worse than it is, when in reality you’ll only have to deal with slightly increased rates, charges and deposits for a small time – as long as you make the payments to the bad credit mortgage on time, your credit score will take care of itself. This grants you the obvious benefit of being able to get a mortgage immediately, move on with your life and, if you wish to, change your mortgage in the future once your credit score has improved.

Speak to an advisor

Taking out a bad credit.mortgage

Posted on | by Neil Alexander

Have you been denied a mortgage because of your credit history? Do you have bad credit and wondering how to get a bad credit.mortgage?

Clever Mortgages can help applying for a bad credit mortgage

Finding a lender who will be willing to offer a ‘bad credit mortgage’ can sometimes be difficult. Here at Clever Mortgages though, we have access to hundreds of different mortgages and could find you a solution, even with a low credit score. We look at each case individually and work with the lenders who could provide you with the best mortgage based on your circumstances.

Click here to apply for a mortgage

Understanding Bad Credit

A person with bad credit is mainly caused by late/missed payments, defaults, CCJs and bankruptcy.  Having no previous credit, is also linked to a low credit score. Both of these can flag to lenders a higher risk to lend – and a reason why it can be more difficult to secure a mortgage.

Our team at Clever Mortgages understand that everyone’s circumstances are different and they may have got into financial difficulty through no fault of their own, for example long-term illness, a breakdown in relationship or losing their job. We assess people’s financial situation and what they can afford to make sure we help to find the right bad credit.mortgage.

Do I have Bad Credit?

If you have missed payments or defaulted on a debt, then your credit score will have been affected and you will have bad credit profile. Other signs of having bad credit include:

  • Being declined for a credit card and loans
  • Being declined a mortgage by a high street lender
  • Declined or increased premiums on insurances
  • Receiving calls from debt collectors
  • Being offered high APRs and low credit limits
  • Not being able to secure a rented property

You can find out your credit score and view your full credit history from a credit file provider such as credit karma, the scores do differ between providers, but it will give you a good guide. The credit report will give you details of who you owe money to, dates of when you have missed payments and a list of companies which have tried to check your credit score.

You might be aware if you have a bad or good credit history, as you have missed payments, been late with payments or not made the payments at all, you may also be pestered with calls from debt collectors.  This will point to your credit score not being as good as it could be.

Speak to a specialist

Why People Fall into Bad Credit

Though people’s cases are usually unique, here are some of the most common reasons people fall into bad credit.

  • Health Challenges: This is one of the (sometimes) unavoidable challenges that could cause bad credit. People who have gone through a rough patch of illnesses that can make it difficult to keep up with payments, especially when they are still in a long period of recovery.
  • Loss of Job: Due to a loss of or reduction in income, you may not be able to meet the agreed credit repayments.  Failure to meet your repayment amounts and deadlines damages your rating. Your repayment history is added to your credit history which lenders will consider deciding whether or not to lend to you.
  • Change in family circumstances: You may have had an addition to the family, which has meant a parent taking time of work, if this has led to a reduction in income, at a time of higher spend, you may find yourself missing payments. Also, a death of a made income earner can have a massive impact on the finance and ability to repay debts
  • Over Committing: You may have taken on too many financial commitments at one time and this has led to unmanageable monthly payments
  • Changes in interest rates: A lender may have increased your interest rate after a special or introductory rate, or you may have breached the terms and they have imposed a higher standard or even penalty rate
  • Divorce or separation: The financial issues that result from divorces can affect your credit. With an immediate change in income and expenditure, it could be that two households are now supported for the same income as a previous one. There could be joint debts and one party may not make the payments as they fall due. This could lead to both credit reports reflecting bad credit. This will continue to go on until the account is completely closed or your name is totally removed from the account.
  • No credit history: Whilst this is not ‘bad credit’. It may come as a surprise that you fall into a similar bracket to it.  You may think, since you’ve had no credit and therefore no chance of bad credit that you are ok to lend to.  However, as you have no proof of paying a debt back on a regular basis, lenders will be cautious in being the first to lend to you.

There are many more reasons people fall into bad credit. At Clever Mortgages, we listen to each individual story, assess the situation, and help to find the right mortgage solution for you.

How Bad Credit affects Mortgage Applications

When a borrower submits an application for a mortgage, the lender will consider many things, the main one being the individuals credit profile and score, this will lead them to a decision as to whether or not to lend.

However, if you have a low score or bad credit, this doesn’t mean you cannot get a mortgage. Clever Mortgages specialise in helping customers every day, achieve their dream of buying a house or refinancing their current property.

Use our mortgage calculator to see our best rates

Please note, individual circumstances may alter results

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Why You Should Use a Mortgage Broker to get a bad credit.mortgage

Mortgage brokers are experts that can provide you as a borrower with many lending options, from high street lenders to those that sit behind or may even be part of a high street lenders.  With different products, loan types and rates, if there is a lending option out there, Clever Mortgages will find it.

Using a mortgage broker will not only increase your chances of getting a bad credit.mortgage, but it can also help you obtain mortgages with reasonable rates. Furthermore, as a mortgage broker has access to most of the UK lenders and the knowledge of what they will offer, it can save you time and effort in finding the right mortgage.

A mortgage broker will also help you deal with all the necessary paperwork involved in obtaining the mortgage.

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Why You Can Trust Us

Clever Mortgages are mortgages brokers you can trust and feel comfortable with. We specialise in finding the right mortgage solution for every individual or family. We do this by reviewing your situation and then helping to find the best bad credit.mortgage for you circumstances.

Here are some of the reasons why we are your ideal bad credit.mortgage broker:

  • We are experts in dealing with bad credit, having a team of people who are knowledgeable about what to do for individuals with bad credit. We have already helped many people obtain the right mortgage for them. We could help you with yours too.
  • We listen and understand. As a bad credit mortgage broker with valuable experience, we know that not all customer’s cases are the same. This is why our team pays close attention to understand your situation and help you get a mortgage that is suitable for your situation
  • We source the most suitable mortgages for all our customers. We work with more than a hundred lenders, some of whom specialise in providing mortgage for people with bad credit.
  • We have a great support team. We understand how taxing getting mortgages—especially bad credit mortgages—can be. For this reason, we provide our customers with all the necessary support to ease the entire process, helping to make the mortgage process a stress-free one.

You could still get that affordable mortgage you desire, even with the bad credit – helping to get your finances back on track.

We will be there with you all the way. Arrange a callback or click below to apply and see how we could help you

Apply for a mortgage
Mortgages For People With Bad Credit

Mortgages For People With Bad Credit

Posted on | by Neil Alexander

If you’ve had an IVA, you might be concerned that you won’t be able to get a remortgage product – especially one that’ll actually reduce your monthly repayments. In this guide we’ll look at:

  • How we helped our customer to get a new mortgage with the same lender
  • Ways Clever Mortgages could help you find a mortgage with poor credit
  • Why use a mortgage broker to help you find a lender who’ll lend to customers with bad credit

How we helped by finding a mortgage with bad credit:

With Clever Mortgages, we were able to help Mr and Mrs T

  • Get a mortgage, even with a poor credit history
  • Secure a lower rate than their current mortgage
  • Bring down their monthly repayments, to help them get back on track

 BalancePaymentRateTerm
Current Mortgage£93,360£803.004.99%13 Years
New Mortgage£93,360£678.562.14%13 Years

Completed 05/06/2019

Our client had been in an IVA, which was completed by the time they came to enquire with us. Their main goal for the remortgage was to bring down their monthly repayments, which was more important to them than reducing the term. Our broker searched and found that the best deal for them was with their current lender – making it easier still to switch.
We were delighted to be able to take the hassle away from the remortgage process for them, and to secure this remortgage deal. We found a great deal, reducing their rate from 4.99% to 2.14%, bringing their monthly repayment down from £803 to £678.56 – meaning they save over £120 every month – over £1450 a year.

It’s true that getting a mortgage with a default can mean your options are more limited – but we can help to find the right remortgage deal for you, that could make a big difference to your monthly outgoings.

Arrange a call

We’ve helped 1000s of customers, just like you with bad credit, to get on the property ladder.

We help customers with bad credit every day, and we know the best lenders and products to look to for each individual situation. We could give you the best chance of getting on a great remortgage deal, even if you’re:

  • Needing a mortgage after an IVA
  • Looking to remortgage with a debt management plan
  • Worried about other defaults on your credit file
  • After a bad credit self-employed mortgage

Enquire with us about getting a remortgage with bad credit, and we could:

  • Search for the right deal for you, even if you’ve got a poor credit history – many of
    the customers we help have found themselves in a bad credit situation, and might
    have been on a Debt Management Plan or in an IVA.
  • Discuss with you the different options available – for instance, you might not have considered using a guarantor or applying for a joint mortgage, we can discuss what might give you the best chance of getting a mortgage on a better rate.
  • Make sure your application goes to the best lenders for you – not all lenders offer mortgages to people with a bad credit history, but we know which ones are most likely to say “yes”, and to give you a good rate when they do.

Why should I use a mortgage broker for my remortgage?

  • Some remortgages for people with bad credit are only available if you go through a mortgage broker – we know the mortgage lenders who accept defaults
  • 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
  • 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 getting a remortgage with bad credit, contact our team today. We are experts in offering solutions to people with bad credit and can help if you need a hand with your next move.

Arrange a call

Bad Credit Remortgage

Posted on | by Neil Alexander

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
Arrange a call

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.

Speak to an advisor

Watch our video on the remortgage application process

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

Speak to an advisor

Can I Get A Mortgage With Bad Credit?

Posted on | by Neil Alexander

If you’re worried about getting a mortgage with bad credit, rest assured we help customers
every day just like you. Here we’ll cover:

  • How we helped a customer who’d had an IVA to get a mortgage and get on the property ladder
  • How we could help, by knowing which mortgage lenders accept bad credit applications
  • Why it’s best to go through a mortgage broker when you’ve got bad credit
Speak to an advisor

Can you get a mortgage with bad credit?

We help customers do just that.
With Clever Mortgages, Mr D was able to:

  • Get a mortgage, even with a poor credit history
  • Secure a fixed rate of 2.99%
  • Find a 95% mortgage

 BalancePaymentRateTerm
New Mortgage113,050584.912.9922 Years

Completed 09/07/2019

Our client had been in an IVA, which started in January 2011 and was cleared in January 2017. Since the IVA, he’d managed to save money for a deposit towards a house purchase.
In the meantime he was renting, and paying £425 a month to his landlord.

A bad credit mortgage, with just a 5% deposit

We were delighted to be able to help him take that important step onto the property ladder, and get back on track. His deposit was only small, but we found a great deal on a 95% mortgage, at a very competitive rate for this level of 2.99%. This is a fixed rate for 2 years, after which we’ll be able to look at even better deals once he’s had that period to build some equity in the property.

Why should I use a mortgage broker?

  • Some mortgages for people with bad credit are only available if you go through a mortgage broker – we know the mortgage lenders who accept defaults
  • 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
  • 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

Getting on the property ladder might be possible, even with bad credit

If you’re wanting to know if you can get a mortgage with bad credit and if you’re currently in rented accommodation, you might be feeling keen to get on the property ladder, and start paying off your own mortgage every month, instead of someone else’s. But you might be worried that lenders won’t consider lending to you.

Arrange a call

We’ve helped 1000s of customers, just like you with bad credit, to get on the property ladder.

When you apply for a mortgage, the lender will assess your application according to their criteria. Lenders all have their own guidelines, so there are often things that’d cause your application to be declined by one, but not by another. We help customers with bad credit every day, and we know the best lenders and products to look to for each individual situation.

Enquire with us about a mortgage with bad credit, and we could:

  • Try to find the right deal for you, even if you’ve got a poor credit history – many of the customers we help have found themselves in a bad credit situation, and might have been on a Debt Management Plan or in an IVA. We take great pride in helping customers when we can, to get a mortgage and get back on track financially.
  • Discuss with you the different options available – for instance, you might not have considered using a guarantor or applying for a joint mortgage, we can discuss what might give you the best chance of getting a mortgage on a better rate.
  • Make sure your application goes to the best lenders for you – not all lenders offer mortgages to people with a bad credit history, but we know which ones are most likely to say “yes”, and to give you a good rate when they do.

What next?

If you are looking for expert advice on getting a mortgage with bad credit, contact our team today. We will be happy to help advise you on what you can do to give you a good chance at taking that important step onto the property ladder.
We are experts in offering solutions to people with bad credit and can help if you need a hand with your next move.

Arrange a call
House with sold sign at the front showing a bad credit score as a red icon

Can I Get A Mortgage With Poor Credit?

Posted on | by Neil Alexander

When you apply for a mortgage, the lender tries to predict your reliability for making your repayments responsibly, based on the way you’ve acted in the past. To do this, they look at lots of different data that’s stored on your credit file. This might include how many applications for credit you’ve made recently, how much you owe, what credit products you’ve had and whether you paid them off on time.

If you have a bad credit score, mortgage lenders are less likely to lend to you, and you might have already been declined by a lender. But all is not lost. We help people every day who are worried they won’t be able to get a mortgage due to their bad credit situation – so don’t give up hope, we might be able to find a good mortgage deal that’s just right for you.
The advantages of using a broker

Using a broker like Clever Mortgages to help you get a bad credit mortgage could increase your chances, and this is partly because many of the mortgages available to people with bad credit are only available to brokers, and not directly to the public.

So, no matter how hard you try to apply to some lenders, they simply won’t lend to you unless you’re with a broker. We help customers with bad credit get the mortgage that’s right for them – and that’s because we know the lenders that are most likely to say ‘yes’, and to give the best rates.

When you enquire with us, we’ll ask about your income (you’ll need to have various documents, such as payslips and bank statements showing your salary going into your bank), all your outgoing details, and we’ll find out from you the total amount you want to borrow, as well as any deposit you have to put down. The bigger the deposit, usually means the better likelihood of getting a good deal.

Consider a joint application

If your partner has a more favourable credit score than you, it could be worth considering a joint mortgage, as then their credit history will be taken into account too.

Together you might have a bigger deposit and can both bring your salaries into the equation – making you a much more appealing prospect to lenders.
Some quick facts about taking out a joint mortgage:

• Most joint mortgages are taken out with two people on them, but some lenders will allow up to four.
• Everyone named on the mortgage is responsible for making sure repayments are made.
• Most joint mortgages are taken out by couples, but you can also take out a joint mortgage with a friend, or a family member, or even a business partner you want to share a new investment with.
Make sure you can afford your repayments

Bad credit mortgages will typically involve higher interest rates, which will mean repaying more money each month. So you’ll need to work out exactly what you’d be expected to pay and decide whether you can afford this as well as all your other outgoings.

We can help advise you on what your mortgage repayments might be.
Here’s what you’ll need to consider:

• Make sure you know exactly what your mortgage repayments will be. You can use our online mortgage calculator to give you an idea of what to expect.
• Write down and add up all of your monthly outgoings – petrol, food shopping, leisure, bills – and don’t forget to leave some extra each month, for the unexpected, e.g. your car needing some work, or something in the house going wrong.
• Consider what you’d do if your situation changed, make sure you think about a mortgage insurance plan that’s right for you.

Consider getting a guarantor

If you’re unable to get a mortgage because of bad credit, a family member or close friend, might be in a position, and willing, to be named as a guarantor. Getting a guarantor is a big step, as you and your guarantor will be tied to each other financially for the term of the mortgage. This can impact on both of your credit ratings.

The guarantor would often have to state they’ll secure the mortgage against their house (or another large asset), which means that if you defaulted on your mortgage payments the guarantor may be liable.

Getting a guarantor doesn’t remove the need to be credit checked, but it can mean that if you do have bad credit, you’ve got a better chance at getting a mortgage.
How to improve your credit score

A good credit score can help increase your chances of successfully applying for a mortgage – and get you a better rate too. Ways to improve your credit score include:

  • Keep credit card balances low.
  • Check for any mistakes on your credit file. Your credit score may be negatively affected if information about your financial history is incorrect on your file.
  • Stay within agreed overdraft limits. Speak to your bank if you’d like an overdraft on a current account, but make sure you stick within the agreed limits.
  • Make sure you’re on the electoral roll for your current address.
  • Don’t make too many applications for loans or cards – too many applications, especially in a short space of time, can have a negative effect on your future score.
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We can help you remortgage even with bad credit

Posted on | by Neil Alexander

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.

A mortgage is not only the biggest financial commitment for most people, but also the biggest headache if it becomes difficult to make the monthly repayments. Remortgaging can be a great option if you’re reaching the end of your current terms and would like a better rate as part of a new deal – especially if you’re in debt.

Are you in debt and would like to remortgage?

There are many reasons for getting into debt, such as unemployment, ill health or the breakdown of a relationship. Getting behind with bills for one month can soon escalate into a much bigger problem if you start relying on credit to pay for household costs – which then leads to increased debt, higher monthly repayments and marks on your credit file if you get behind with your bills.

Bad credit is also a bit of a sweeping statement. The thing is missing just one payment, for example if you forget to pay a credit card one month or you don’t have enough money in your bank account for a direct debit to pay your mobile phone bill, can leave a mark on your credit file and lower your credit score. Did you know a missed credit card payment could affect your credit score for three years?

Bad credit can be a result of CCJs, mortgage defaults, IVAs or bills that have been paid late. You can even have a low credit score if you’re self-employed, with no proof of income, so you simply haven’t built up a credit history yet.

If you’d like to remortgage your home but have a low credit score, we’ll use our experience of the specialist lending industry to provide you with the most suitable solution based on your circumstances.

Bad credit remortgages

It’s not a problem if you’ve been turned down for a remortgage by a high street bank or lender as Clever work with a wide range of providers who can help people in many different and complex situations. We have access to lenders are able to assist with most credit profiles, whilst providing a high level of customer service and expert decisions you can count on.

We can help whether you’re self-employed, a contract worker, if your income is seasonal or you rely on extra part-time work or bonuses. No matter what your circumstances are, we’ll review your situation, affordability and advise on the most suitable remortgage solution for you.

Remortage deals even if you have bad credit

At Clever Mortgages we treat our customers as individuals and we know everyone has their own set of circumstances that our expert staff will take into account when looking to find you a positive outcome.

We’ll take the time to fully understand your requirements and work on your behalf to look at all possible options to find the most appropriate remortgage for your current circumstances and future financial journey.

For every application our aim is to find a remortgage that suits your plans, and one that you can afford now and in the future. We can help even if you’ve had defaults on your credit file.

Clever Mortgages is your route to your new remortgage so make sure to talk to one of our friendly team today on 0800 197 0620.

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Watch our video on the remortgage application process

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A man looks at bills and a calculator as he considers a debt consolidation loan

The main benefits of a debt consolidation loan

Posted on | by Neil Alexander

If you’re currently dealing with multiple loans from different loan providers then consolidating this debt can be a good option. A debt consolidation loan allows you to combine all your existing debts to provide you with one monthly repayment. This loan is used to pay off your individual loans, leaving you with one large loan instead. Consolidation loans are usually ideal for people who have multiple repayments to make on different credit cards, loans and overdrafts.

Here are some of the main reasons why taking out a debt consolidation loan can be a good idea and some of the things you should be wary of:

One monthly payment

It’s likely that your current payments are required on different days each month. This can be difficult to manage and often quite stressful. By consolidating your debt you can streamline everything into one single source and make just one payment each month. Having one payment can make managing your loans much easier. One fixed monthly payment can also help you to more easily budget for other things.

Lower interest rate

Using a debt consolidation loan can also help you to save money on interest. This is especially the case if you have several credit cards with high interest rates. If the rate of borrowing on a consolidation loan is lower than your original debt then you could reduce the amount of interest you pay on a monthly basis.

Improve your credit score

If you’ve fallen behind on any of your existing loan repayments then it’s likely your credit score has suffered. Taking out a consolidation loan can help to improve your credit score. This is because it gives you an opportunity to demonstrate that you’re a responsible borrower.

Things you should be aware of:

Even though a consolidation loan may save you money on a monthly basis, depending on the rate and term, you could be increasing the total amount you pay back and the duration of the repayments.

Another thing you should avoid doing is borrowing more than you need to. A debt consolidation loan should be a tool to consolidate your debt, rather than create more.

 

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Things to avoid doing when applying for a mortgage

Posted on | by Neil Alexander

When applying for a mortgage you will want to avoid doing anything that could hold back your chances of being accepted. You might have already been working hard to improve your credit score and shouldn’t want to do anything that could further implicate your application.

Lenders will want to see that you can afford to make monthly mortgage payments. They will typically use your credit report, your most recent payslips and your P60 to determine this.

We have put a list together of the things that mortgage lenders can view negatively during your application process. You should avoid doing any of these at all costs.

1.     Applying to multiple mortgage providers

Many people presume that by applying to lots of different places for a mortgage, they will eventually find a lender who will accept them. In fact, by doing this you can actually make it more difficult for you to get a mortgage. When you apply for any type of finance, the lender will typically carry out a search on your credit file. This will leave a footprint that other lenders will be able to see.  Too many applications within the same time period can be viewed negatively by lenders as it can look as though you have a desperate need for finance. By using a mortgage broker you can be confident that we will find you the most affordable and appropriate mortgage for your circumstances.

2.     Taking out another loan

You also shouldn’t consider taking out any other forms of credit whilst applying for a mortgage. This includes anything from a car loan to a phone contract. New loans can be a red flag for mortgage providers when you’re in the middle of your application. The reason for this is that lenders base your application on your DTI (Debt to Income ratio) at that time. Any changes such as a new loan will increase your DTI and can create a delay or even cause lenders to reject you. A huge concern for lenders will be whether you can still afford the mortgage payments on top of the new loan you have taken out. They will need to re-evaluate your situation in order to make a decision.

3.     Overusing your credit cards

Credit cards are also taken into consideration in your debt to income ratio (DTI). Making large payments on your credit card can affect your ratio so you should avoid doing this before and during your mortgage application. Additional debt on your credit card is a common reason for mortgage rejection, so you should refrain from doing anything out of the ordinary.  Any large purchases should ideally be held off until after your mortgage approval.

4.     Making a major purchase

Even if you’re not using a credit card to make payments, you should still avoid making any other large purchases when applying for a mortgage. Lenders will want to see that you have plenty of cash available throughout the process to take care of the various mortgage fees. If they see you’ve made a large purchase they might question your ability or intentions to repay your mortgage.

5.     Late payments on any current loans

Managing your current loans should be a key priority when applying for a mortgage. Falling behind on any money you owe can be extremely damaging to your mortgage application. If you do, mortgage lenders will likely assume that they can’t trust you to make any future payments on time. This can lead to your application being rejected altogether. It can be especially damaging if you have a history of bad credit and need to prove that you are able to make payments on time and in full.

6.     Switching your job

If possible, you should avoid changing your job during your mortgage application process. Lenders prefer you to be past the probation stage of your job role. Many lenders also won’t accept your application if you’ve been in your current employment for less than twelve months. This is because your job can be considered less secure and lenders don’t want to run the risk of you losing your job and not being able to afford to make the payments.

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Myths around mortgages and credit scores

Posted on | by Neil Alexander

Your credit score is one of the most important pieces of information about you when it comes to borrowing money. Mortgage lenders use your credit record to help them make a decision on whether they should lend to you.

However, despite their importance, there’s still a lot of misunderstanding and confusion around credit scores and what they mean. Below, we explain the most common questions and myths.

The most common question is, can you get a mortgage with low credit score?

The answer is probably yes, although every situation is different and it can sometimes limit the mortgages available to you.

We have a team of specialist brokers that deal specifically with bad credit mortgages. Speak to one of our brokers today to see if we can help you. There is no obligation and the initial advice is free.

Read below for all our mortgage myths around credit scores

What to do next

Speak to our expert brokers for free advice on all types of mortgages, remortgages, even if you have bad credit. One of our expert brokers will be able to review your current situation and advise on the best way of moving forward with our knowledge and access to over 100 lenders and thousands of mortgage products.

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0800 197 0504

The myths uncovered

Here we list some of the myths surrounding credit scores and what they can mean for your mortgage application.

“My credit score is too low to get a mortgage”

There’s no set minimum score required to get a mortgage. This is determined by the lender themselves. As lenders have different levels of tolerance, some will be more willing to consider you than others if you have bad credit. Although many won’t want to risk lending to someone with bad credit, there are lenders who can help.

If your credit score is low then applying with a company who specialise in offering bad credit mortgages will give you the best chance of getting approved. These mortgages work in exactly the same way as a standard mortgage, but interest rates will be higher and it’s likely that you will need to put down a bigger deposit.

“Negative information on my credit report will stop me getting a mortgage”

There are still mortgage options available to people who have negative information on their credit file. This might be a CCJ, defaults from previous loans or even a bankruptcy discharge. You may have otherwise been in an IVA or other debt plan to help repay your debts. If you’ve struggled financially in the past but are back on track now then there are lenders who will consider your application. This negative information remains on your credit file for a maximum of 6 years, so if you’re unsure that it still exists you should check your credit report. You can do this through a credit reference agency such as Experian or Equifax.

“I’ve never borrowed which means I’m a safer customer to lend to”

Lenders actually prefer to lend to people who have some history of making loan repayments. It provides proof that you have previously made payments on time and in full. As you’re likely to continue with this behaviour, it can make you be perceived as more trustworthy than someone who hasn’t borrowed before. This is because those who haven’t borrowed can’t provide any evidence to show they will make payments on time.

Having no credit can often make it just as difficult to get a mortgage as having bad credit. You should work to try and improve your credit score if you’re in this situation. This can often be the case if you’re a first-time buyer and have never had a mortgage or loan before. If you’re getting your first mortgage, here are some ways you can improve your chances.

“My partner has bad credit so neither of us will be able to get a mortgage”

If your partner has struggled with debt then it’s natural to worry about how this might affect you as well. The good news is that there are lenders out there who are willing to consider your application whether you’re buying a house individually or looking for a joint mortgage. If you have no financial links with your partner already, such as a loan or a joint bank account, then your partner’s credit score won’t affect you getting a mortgage independently of them. Even if you’re married you won’t be associated financially unless you have some sort of joint finances. Alternatively, you might be asking will my bad credit score affect my partner?

If you’re looking for a joint mortgage, however, you will become financial associates and will both be liable to repay. A joint mortgage will allow you to borrow more money, as it will take into consideration both your incomes.  Despite whether or not you have a good credit score, your partner’s bad credit will affect your interest rate on the mortgage and will likely require you to put down a larger deposit. As each person’s situation is unique, it’s best to speak with a mortgage advisor before applying.

Take a look at our article on joint mortgages for further information.

“Being on the electoral roll isn’t important”

If you have bad credit you should be doing everything you can to help improve your score. One of the ways you can do this is by making sure you’re on the electoral register. If you’re not then you should register as soon as possible. Although it’s not compulsory to vote, having your details available on the electoral roll allows lenders to easily verify your identity and address. This can have a positive impact on your credit score. If you’re not sure if you’re already registered, you can check on the website Your Vote Matters.

“Applying to different companies will increase my chances at being accepted”

Many people assume that if they keep applying for finance they will eventually find a company who will accept them. This couldn’t be more incorrect. When searching for finance, multiple applications can be one of the worst mistakes you can make. Each time you make a credit application it leaves a mark on your credit file. This is because the lender will typically carry out a “hard” search, which will leave a footprint on your credit file that other lenders can see. These have a direct impact on your scoring as they show your level of need for credit. If you have too many applications made within the same time period, lenders can be put off by your application as it can seem as though you’re desperate for credit and therefore potentially less likely to make payments on time.

The best way to approach finance applications is to do your research before applying and if you know you’re going to apply to more than one, then try and spread these out over a few months. If you want to make comparisons, you can always ask the lender to run a soft search for a quote, which will only be visible to you.

“I’ve not checked my credit score but I presume it’s ok”

Your credit score is not something that will be made itself known to you. So if you don’t check your credit score, you won’t know if it’s good or not. Many people have never checked their credit reports. Some people do this because they’re afraid of the result; others don’t check it because they don’t understand the importance of it. Some people also avoid checking their credit report because they think that this will have an impact on their score. In actual fact you should make sure you check your score regularly so you can know the situation you are in, how you can improve it and what help you to identify what types of finance you will be eligible for. This can help you avoid being rejected.

You can check your credit score through a credit reference agency such as Experian or Equifax.

“My bad credit will always hold me back”

Just because your credit is bad now doesn’t mean it will stay this way forever. There are a number of things you can do to improve your credit score and get your finances back on track. This might mean paying higher interest rates, for now, to make up for it, but over time you can prove to lenders that you’re a trustworthy person to lend to again.

What to do next

Speak to our expert brokers for free advice on all types of mortgages, remortgages, even if you have bad credit. One of our expert brokers will be able to review your current situation and advise on the best way of moving forward with our knowledge and access to over 100 lenders and thousands of mortgage products.

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Broker Callback

0800 197 0504

Why use a mortgage broker?

Mortgage brokers can help you find the best deals on the market – not just from one lender. With a broker you’ll get:

  • Valuable knowledge, through years of experience helping customers with bad credit to find mortgages
  • Find the right mortgage first time – some mortgages are only available through a broker
  • Help with the application process
  • Advice on all options available, such as help to buy, guarantor or shared ownership

Speak to a broker

Christie Buck

Christie is a specialist mortgage broker, whose been working for Clever for 6 years. She has been in the financial industry for nearly 11 years which included assisting clients in financial difficulty setting up IVAs.

Call us on: 0800 197 0504

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About Clever Mortgages

We specialise in assessing an individual’s situation, and finding the right mortgage solution for them. We can help:

  • With remortgages, buy-to-let, and first-time buyers mortgages. We have experts who cover these areas
  • Even if you’ve got bad credit – we help people every day with a variety of credit histories to find the right mortgage
  • With applications, as we’ll take the hassle away. We require your details once and we’ll know the best lenders for your circumstance
  • Our team know the lenders that are most likely to say ‘yes’, and give you the best rates

What should I do next?

  • You enquire online with us today or request a call back
    Our simple form takes a couple of minutes to fill in, this gets the ball rolling
  • One of our experts will give you a call to find out more about your situation
    We have experts in remortgaging, who focus solely on helping customers save money
  • We do all the hard work for you
    We search the market for the trusted lender that’s right for you
  • Our expert will get back in touch
    We can guide you every step of the way, and we’ll always keep you up-to-date with progress

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Ways to improve your credit score

Posted on | by Neil Alexander

A poor credit history can complicate things when trying to get a mortgage. Many mortgage providers won’t lend to someone who has suffered from bad credit regardless of their situation now. If you’re confused about credit or you’ve been unsuccessful in getting a mortgage then you should work to improve your credit score.

Unfortunately, there’s no quick fix for your bad credit score. Your credit history has been built up over time and the things that have had the biggest impact will be different for everyone. You will need to demonstrate over time that you can continually make payments in full and on time. Any negative information that might be on your credit file such as CCJs, an IVA, late payments or bankruptcy will exist on your credit file for 6 years since the date they were recorded. You might need to wait until these have disappeared from your file if they are preventing you from getting approved.

Luckily, there are some things you can start doing right away to help improve your credit score:

1.     Check your credit report

The first step to improving your credit is to know exactly what your situation is. You should get into the habit of regularly checking your credit score. This is so you can make sure the information about you is accurate and up to date. You will also be able to see how your credit score improves over time as you start making more positive financial decisions. Checking your credit score is free through a credit reference agency including Experian, Equifax or Clear Score.

2.     Plan to pay off your existing debt

Try and pay off all your existing debt as soon as possible. If you can’t do this yet you should create a plan so you know when you’ll have this paid off. If you use any savings to help pay off debts then make sure you still have some money aside for emergencies. This will help you to avoid getting into any debt again. Paying off your current debt will help to show lenders that you’re working to rectify your current financial situation.

3.     Be cautious when using credit cards

Cancelling any credit cards that you no longer use can help to show that you’re intending to borrow less. It can also stop the temptation to use them at any point. On the other hand, if you don’t have a credit card, taking one out and managing it properly can help to improve your credit score. You should only do this if you know you can afford to make repayments on time and in full.

4.     Have some responsible credit

If a credit card is not appropriate for you, or if you can’t get approval for one, then taking out a small form of credit might be a better idea. This could be a mobile phone contract or store card. Providing you manage these well it can show lenders that you can pay bills responsibly, helping you to show that you can be trusted with a bigger loan.

5.     Get on the electoral roll

Another way you can help to improve your credit is by making sure you’re on the electoral roll. If you’re not then you should register as soon as possible. Although it’s not compulsory to vote, having your details on the electoral roll allows lenders to easily verify your identity and address. This can have a positive impact on your credit score.

6.     Consider bad credit finance

If you can afford to pay higher interest rates and potentially put down a bigger deposit, then bad credit finance options such as a bad credit mortgage might be for you. These are designed for anyone who has a low credit rating and unable to get competitive rates for finance. The benefit of paying higher mortgage rates, for now, is that providing you pay on time in and full, it can demonstrate that you are someone who can be trusted to lend to. If you can continue to prove this you will increase your chances at being eligible for more competitive interest rates in the future.

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