Given the current economic climate in the United Kingdom, it is no surprise many people have an adverse credit rating. Some people aren’t concerned about an adverse credit rating, but a lot of people have found a poor credit rating acts as a barrier to their aims and ambitions.
It is believed that around 1.26 million people who have bad credit are keen to buy property next year. A lot of these people will begin the process of looking for a mortgage, but many will be disheartened by the lack of options. Many lenders won’t provide a mortgage for people with bad credit, but there are options for borrowers to consider when it comes to moving on with their finances.
Some lenders offer specialist loans for people with adverse credit
There are lenders who offer specialist mortgages, and many of these lenders provide bad credit options. This is good news for people who have suffered credit problems. Some of the most common credit problems people suffer from include:
- Missed payments
- County Court Judgments (CCJs)
- Defaulting on payments
- Unsecured arrears
- Secured arrears
Just because a person has suffered a credit issue doesn’t mean they should be allowed access to affordable mortgages. Even though lenders need to vet applicants, there are lenders who are willing to provide affordable loans to people whose credit rating and history marks them out as a less than secure option.
There are pragmatic underwriters operating in the industry
Some underwriters take a more pragmatic view of an applicant’s circumstances. You’ll also find pragmatic underwriters understand that it is the present day and future which is more important when deciding on a mortgage application, not necessarily the person’s history.
With more lenders willing to offer mortgages to people with bad credit, it is vital that people in this financial situation recognise they have options. Studies have shown that many people who have suffered an adverse credit situation believe they are barred from obtaining a mortgage. This isn’t necessarily the case, and finding the right lender opens up possibilities for people looking to buy a home.
Many more people are expected to hold adverse credit ratings
With so many people and households struggling financially, and suffering adverse credit moments, it is likely this scenario will increase. Therefore, it won’t be a surprise to learn many mortgage lenders will look to offer loans that reach out to these people.
If you are looking to obtain a mortgage, it is still vital you do as much as you can to improve your finances and make as strong as application as possible. If you do this, and research the lenders who are more likely to offer you a loan, it is possible to arrange a mortgage that suits your needs and budget.
It is expected that applicants with bad credit will likely pay more than people who don’t have an adverse credit history, but there should still be affordable options available, which is positive news.