The Abundance Of Home-saving Mortgages For People With Poor Credit History.
Below is a MRR and PLR article in category Finance -> subcategory Wealth Building.
Home-Saving Mortgages for Those with Poor Credit: Opportunities and Solutions
Introduction
Every day, the Citizens Advice Bureau handles over 5,000 new debt-related inquiries. With rising interest rates, more people are likely to encounter debt issues. In 2007, we expect a ten-year high in county court judgments (CCJs), reaching around one million.
The Challenge of Poor Credit
Securing a mortgage with poor credit can be daunting. High Street lenders often reject applications from individuals with defaults or CCJs. So, what are your options?
Understanding Your Credit Rating
The UK has two main credit reference companies. Checking with them can reveal your credit rating. If you have a CCJ or default, your credit score may have been affected.
Mortgage Defaults and CCJs
- Mortgage Default: A breach of your credit agreement with a lender. It's documented on your credit file, showing the date of breach, the amount owed, and any remaining debt.
- CCJ: Issued by a local court after a court demand is ignored, leading to a Claim Form requiring payment within 14 days. Ignoring this results in a CCJ, which gives 28 days to pay.
Difference Between Defaults and CCJs
A CCJ can be removed from your record if settled within 28 days. Defaults, however, remain for six years.
Improving Your Credit Situation
If you receive a CCJ, poor credit isn’t inevitable. You can clear it by arranging a quick remortgage with a specialist lender, which can help remove the CCJ from your record.
However, defaults and unpaid CCJs remain on your credit file for six years, impacting credit applications like mortgages, credit cards, overdrafts, and loans. High Street lenders are unlikely to approve these applications.
Solutions for Poor Credit
Fortunately, numerous mortgage lenders now specialize in assisting those with poor credit histories. By remortgaging with these lenders, you can repair your credit by making consistent payments tailored to your needs.
Benefits of Quick Remortgaging
- Debt Relief: Remortgaging can free up home equity, allowing you to settle debts.
- Addressing Mortgage Arrears: It can also resolve mortgage arrears or repossession issues with previous lenders.
Conclusion
While a poor credit history poses challenges, solutions exist. By choosing specialized lenders and exploring remortgage options, you can address debt problems and improve your financial standing.
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