Adverse Credit Mortgage

What is an adverse credit mortgage?
An adverse credit mortgage is also known by the following names. They all refer to the same basic type of mortgage, namely one where the applicant has a history of bad credit.

• Non status mortgage
• Bad credit mortgage
• sub prime mortgage
• Non standard mortgage
• Poor credit mortgage
• Credit impaired mortgage

As you can see there are many different names for it. For the purposes of this website it will be refered to as an adverse credit mortgage because that is the term most people use to describe it.

Adverse credit mortgages are for people who have an adverse credit history.An adverse credit history could include:

• County Court Judgements (CCJ's)
• Mortgage or rent arrears
• Decrees (Scotland)
• Bankruptcy
• I.V.A
• Trust deeds

Mortgage lenders may also turn you down if you have changed address many times or if you are an entrepreneur without 3 years worth of audited accounts. Self-employed borrowers may have to apply for a mortgage via sub prime lenders but may also apply for self-certificate mortgages, meaning they declare their earnings without having a set guaranteed salary.

It is estimated that one in four British people would not qualify for a standard mortgage from a high street lender. This means they require sub prime lenders in order to acquire a mortgage loan. As with any product, if there is a demand then supply will follow, and as the demand for adverse credit mortgages has risen, so too has the number of lenders catering for this need, and there are many sub prime lenders across the UK and also some mainstream lenders who consider lending to people with an adverse credit history.

Pro's and con's of an adverse credit mortgage
Lending money is all about risk. A bank will weigh up the risk factor of lending money to an individual and decide whether they are likely to get their money back with interest without too much hassle. Therefore some lenders will simply not lend to high-risk category borrowers, others will but will adjust their interest rates accordingly. This means you may have to pay higher interest rates on your mortgage. On the positive side you get a home to live in that belongs to you, and if you repay you mortgage back as required by the lender, after three years your credit history will have benefited considerably.

Climbing the ladder to owning your own home debt free
This means that after three years you could remortgage (switch mortgage lenders) to a high street lender and enjoy savings through a lower interest rate. It's all about climbing the ladder from adverse credit history and no property at the bottom to positive credit history and ownership of property at the top.

We specialise in adverse credit mortgages and remortgages and you can enquire here for free with no obligation to complete the deal.

The overall cost comparison Adverse Credit is 11.4% APR. The actual rate will depend upon your circumstances. Ask for a personalised illustration.

The overall cost comparison for Adverse Credit/Self Cert is 12.1% APR. The actual rate will depend upon your circumstances. Ask for a personalised illustration.

The Mortgage Helpline (UK) Ltd is an appointed representative of Home Of Choice Ltd which is authorised and regulated by the Financial Services Authority. Commercial Mortgages and some Buy to Let mortgages are not regulated by the Financial Services Authority. Your home may be repossessed if you do not keep up repayments on your mortgage.