Benefits of Bad Credit Mortgages:
by Digital Zone digital marketerDo you wonder what lenders
will offer you for a mortgage deal on your home? The big obstacle, as you know,
is your bad credit history. Some of the most common obstacles that prevent
people from being accepted in credit programmes are the following: missed or
late payments for loans, credit cards or store cards; defaults or CCJ’s;
mortgage arrears; inappropriate conduct of bank account; repossessions and
bankruptcy, etc. Generally, once people are faced with one or more of these
problems, they are no longer considered to be eligible for obtaining loans or
mortgages, losing their financial credibility towards banks and other
credit-offering institutions.
However, before you decide
not to mortgage because of bad credit history, let me say there are companies
like Independent Mortgage Brokers, offering Bad Credit Mortgages to people with
a less than perfect credit situation. Through this article, we will inform
borrowers of bad credit mortgages, the options and benefits for bad credit.
So, why is it that mortgage
loan providers ignore bad credit history while offering bad credit mortgage? Is
it because they don't fear for payment? Well, fact of the matter is that most
borrowers with bad credit history do pose a higher risk on the loan. Will the
borrower give in this time? No one really knows!
Therefore, it is really
hard to say how loan providers will agree to lend to borrowers with bad credit
history. Making the decision to lend bad credit mortgage is mostly influenced
by the credit score of borrowers. Your credit score is demonstrated by taking
into account the borrowers' credit file. In general, mortgage lenders do this
by checking with the main credit reference agencies (CRAs). Depending on the
lender, they will report to one or two CRAs, whereas Independent Mortgage
Brokers will report to all three: Experian, Equifax & TransUnion, to
calculate a more accurate credit score.
Borrowers with a credit
score of 710 and above will have most mortgage lenders running after them to
take mortgage loans. Borrowers that have a credit score in the range of 620-700
can also get good deals on mortgages. But most borrowers who earn a score of
500 and below are the ones who form the customers of bad credit mortgages.
What are some benefits or advantages from a bad
credit mortgage?
1.First Home Purchase
Through the process of bad
credit mortgage, the borrower will make purchase or construct a home. If this
is a first home purchase, most borrowers can be eligible for some discounts
available to an individual who is taking on a first time mortgage.
2. Reasonable Interest
Interest rates on bad
credit mortgages is largely disputable. Many lenders allege that their act of
approving the borrower a mortgage was a favour; the borrowers wouldn't have
been able to mortgage their house had they not associated with them. Borrowers
who have been refused mortgage loans or other credit lines a few times will
easily accept the statement. Borrowers like this will often fall prey to the
lenders who charge huge sums of interest and fees on the bad credit mortgage.
However, determining a
reasonable interest rate is not as hard as you think. Keep in mind that your
will be higher than that of someone with good credit. One can easily estimate
the interest rate by making a comparison of interest rates charged by principal
lending banks and other financial institutions. Mortgage calculator has a
record of the interest rates for several categories of mortgages. When looking
into the bad credit mortgage category, you know of the least rates prevalent
for the category. You can also confirm that the interest rates found are
correct through a mortgage quote from another lender. Mortgage quote is an
offer by a lender to the borrower to accept bad credit mortgage with some
stated terms attached.
Another important use of
mortgage quotes is to help borrowers in choosing a particular lender that will
fit their needs. If the terms are alright with the borrower, and he/she finds
that the terms offered a particular lender are the best of all lenders, he/she
can choose to accept the bad credit mortgage offered by that lender.
3. Property Investing
An important benefit when
getting a bad credit mortgage is that you are keeping more of your money by not
‘throwing it away’ on a rental property. The amount of money you may be able to
save, and the equity you an acquire by owning a house can be very beneficial to
you in the long run. It is worth it to consider mortgage solutions to purchase
a property, even if your credit isn’t perfect. This allows you to have more
options in the future to make other large purchases when your credit rating
increases.
4. Dealing with Specialised
Companies
Experienced and reliable
bad credit mortgage-offering companies like Independent Mortgage Brokers, are
the ideal choice for persons with poor prospects of obtaining mortgages or
loans somewhere else. Unlike other credit-offering institutions, companies that
are specialised in the bad credit mortgage branch service all categories of
people, regardless of their credit situation. They understand that these people
rarely receive any financial help whatsoever from regular banks and other
similar institutions and offer them the opportunity to remediate their
financial issues.
Such companies also include
many other different packages of services, such as regular mortgages, mortgage
refinancing, remortgaging, interest only mortgages and second mortgages. UK
mortgage brokers are renowned for their professionalism and experience in the
field, as well as devotion in servicing the customer. An important part of
their service, is providing free mortgage advice. Be reassured that with their
specialised help and assistance, you will be on track to recover from bad
credit problems and other financial difficulties.
Conclusion
To summarize, bad credit
mortgages give borrowers a great second chance to improve their credit history,
giving them a positive mark on their credit file. Once you have obtained a bad
credit mortgage and you have had a good track record with the lenders, you can re-finance
your mortgage, obtaining a lower interest rate on your mortgage loan. This all
combined, allows you to rectify your credit situation over the course of time
and get your finance back on its feet.
Remember, you’ll never know
if you could qualify for a Bad Credit Mortgage if you don’t try. Start taking
control of your financial future today!
If you want to receive some
valuable online mortgage advice, please visit Independent Mortgage Brokers.
For
any another query visit site now: Remortgage Bad Credit & Online Mortgage
Broker UK
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Created on Feb 23rd 2021 21:44. Viewed 300 times.