Remortgage with Bad Credit

It is a new mortgage for a homeowner client that, for one reason or another, has a low credit score. The reasons for the remortgage can include to get a new fixed rate deal, to raise money for debt consolidation or home improvements, or to remove a name from a mortgage.

A low credit score can include clients with no previous credit commitments, a CCJ, a default, missed payments, an IVA or something else.

With a remortgage application, it’s more about ‘what and when’ rather than around the actual score. All mortgage lenders have different criteria as to when they accept clients with bad credit. This lending criteria will be based on when the bad credit occurred, what it was, why it happened, and how much it was for.

A good place to start is to obtain a copy of your credit report and your mortgage broker can review this with you and find out more about your situation. The 4 main credit reference agencies will all calculate your score differently so it’s hard to say what a good score is compared with a bad one.

However, if you use this link to request a free trial, this will search all 4 credit reference agencies and let you know your score. The password to open the report will be your date of birth in a 6-digit format.

Yes, you’ll have options. Mortgage lenders more work from what has been registered against you, how much it was for and when it was rather than your score.

With a buy to let remortgage with bad credit, you’ll also have the option to fix your deal and to capital raise if you have enough equity.

We have a specialist buy to let mortgage broker team here who have in-depth knowledge of lending criteria. Without an experienced broker by your side, you could run into lots of problems along the way.

Yes, you’ll most likely have options. We work with the main high street lenders along with specialist ones that all have different lending criteria. We’ll need to have a look through an up-to-date copy of your credit report to be able to run through your options.

Some clients choose to remortgage for debt consolidation, this is where you increase your mortgage amount and use the extra to repay any credit cards and personal loans. This is a specialist type of application therefore speaking to an experienced mortgage broker is always important.

Be careful, as lenders do not like recent missed mortgage payments. If you haven’t paid your mortgage on time over the last 12 months, this can prevent you from getting a new mortgage agreed altogether.

If you’ve ever lent money to a friend before, and that friend has paid you back every penny plus interest at the agreed time, you’re more than likely ok lending money to them again if they asked. The same concept applies in the mortgage world.

All mortgage lenders and financial service providers share data via credit reference agencies. Having all this information at hand allows them to make quick and accurate lending decisions.

Having bad credit on recorded on your credit file can impact on which mortgage lender that you can use. Don’t worry though, as we have plenty of mortgage lenders available that can help clients with a low credit score. Having a great mortgage team by your side will prove invaluable.

These will depend on your individual situation; however, peace of mind and a lower monthly payment are the main ones for a remortgage with bad credit client.

Peace of mind is from getting a new fixed rate deal, protecting you from any future interest rate increases. Allowing you to know exactly how much your monthly mortgage payment will be for the next 2, 3 or 5-years.

A lower monthly payment can be a result of a debt consolidation remortgage. Note, specialist mortgage advice is required here as you could end up paying more interest in the long term by securing credit cards and personal loans against your home.

These will be client specific, however, the main ones are the challenges of getting a deal, a higher rate of interest and the potential of paying more interest back over the term of the mortgage.

Without an experienced mortgage advisor on your side, getting a remortgage with bad credit can prove difficult. You’ll find there are more hurdles to overcome along the way.

If you have poor credit, you could end up paying a slightly higher rate of interest. This will depend on whether you meet the criteria of a high-street lender and if we must look at specialist lender options. At the end of the new fixed rate, providing that your credit score has improved, we can then look at a remortgage with a high-street lender for normal rates.

If you are considering a debt consolidation remortgage to repay credit/store cards and personal loans you could end up paying more interest in the long term by securing credit cards and personal loans against your home. This puts your home at risk of repossession. This is an important consideration, and your mortgage advisor will run all the risks involved in more detail.

Yes, you’ll have options. If you are considering a help to buy remortgage it’s always best to speak to a mortgage broker, like us, to know your options.

A help to buy mortgage is when you increase your lending on your property in order to repay the 20% (or 40% in London) equity loan back. The outstanding balance of the loan is linked to your house.

You’ll have options such as paying the full amount back to Homes England, paying part back and then considering various mortgage deals that are available to you.

For a free consultation to find out your remortgage with bad credit options, no documents are needed. However, when you are ready to progress to a full mortgage application, documents such as 3 months bank statements, 3 months proof of earnings, ID, details of any existing mortgages, credit cards or loans are required along with an up-to-date credit report.

Your new mortgage lender might also request ad-hoc documents along the way as and when required. Our mortgage case handlers will also perform a pre-application check on your documents to work out what the lender might request, we aim to be right first time. Hopefully, speeding up the remortgage process for most of our clients quite significantly.

Whilst this will vary for every client, with a good mortgage broker on your side, it’ll take roughly 2 to 4 weeks to receive a mortgage offer for a bad credit remortgage. Specialist lenders can be more tedious with their paperwork and have slower turnaround times.

A lot of time will be down to the mortgage lender processing your application; however, you can help to keep this time down by being organised with your documents and getting back to us asap with any further information requests.

Yes, there are more options in this space than there has ever been. Mortgage lenders have been very innovative here and there are not lots of products available to help our older clients looking to remortgage or capital raise.

Whether you have bad credit, a low score, receive a low income, benefits or pension income we’ll have options available to you including regular mortgages, retirement interest only mortgages and lifetime/equity release mortgages. You can read more about mortgages for the over 50’s options here.

With the lifetime and equity release mortgage lenders, your credit score is not such a problem as with a regular mortgage because they have the equity in your property as security.

Yes, possibly. Your income, outgoings, age, credit score, employment type, and personal situation will be considered when applying for a remortgage for debt consolidation with bad credit.

Outstanding debt balances, terms and interest rates of any credit cards, store cards and personal loans can be considered when doing a debt consolidation remortgage with bad credit.

Debt consolidation is a very specialist form of mortgage lending, and you should only do this with a trusted mortgage broker on your side, like us. Mistakes can be costly and could result in you losing your home. Also, the total amount of interest you pay back over the term of the mortgage could be much higher.

Yes, lots! We work with both the high street and specialist mortgage lenders with criteria aimed at helping customers remortgage with bad credit. Working with a trusted mortgage broker like us, you can be confident that you’ll have experience and knowledge on your side.

We have in-depth knowledge of lending criteria and years of experience within our team of helping clients with bad credit remortgages.

Depending on what is registered against you, how much it was for, and, when it was, will depend on which mortgage lender we recommend. Some of the more specialist lenders will charge a slightly higher interest rate, however, when your score picks up in the future you might fit with high-street lenders.