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Best advice for bad credit mortgages


Best advice for bad credit mortgages

Borrowing with bad credit is a challenge because it is harder to get approved, and when it gets approved, you might be required to pay more in the form of origination fee or a higher interest rate. If you happen to have bad credit or a low credit score, you can still refinance your current mortgage or buy a home. Having a low credit score, doesn’t mean you cannot buy a home. There are many lenders who will approve mortgages for qualified borrowers who have bad credit. There are some lenders who even specialize in mortgages for refinancers and home buyers who havelimited credit and there are also ways to find the right lender.

You may have been told that private loans are a good option, and it is true in some cases but what exactly does private loan mean, and where can you borrow? When people talk about private loans, they often refer to one of two things: It can mean Loans from somebody other than credit union or bank or Student loans which do not come through the Department of Education. You can also borrow from family and friends. You might even find out that you have better luck getting approved or that you will pay less if you borrow from “alternative” sources but Just bear in mind that money can sour good relationships, so  you should think carefully before borrowing from loved ones. Also, Peer-to-peer loans can help you avoid going to banks.  It is also safe to borrow from online lenders but you have to use only with well-known sites to avoid having problems.

You do not have to feel judged because of your flawed credit. Here are some tips that will give you the knowledge you need to talk to mortgage lenders with all the confidence and choose the mortgage that is best for you, even with a low credit score.

Know the credit score you need– You should Check this as soon as possible and figure out how far it is from the minimum requirements.

Find out what you can afford.Low credit score may limit your budget, so you have to check and find out what your available score could get you.

Give government loan program a thought. FHA and VA loans often allow loans to people with lower credit scores.

Gather a bigger down payment. Bringing bigger amount for part payment can compensate for a low credit score.

A lot of people ask if they should buy a house with bad credit score or wait to improve it. While it may be possible for you to get a mortgage with a bad credit history, you can also try to improve your credit score first, in order to increase your chances of getting accepted. Here are some of the advantages and disadvantages of getting a bad credit mortgage:


You will have different options to choose from:There are over 1,600 mortgage deals available to customers who have poor credit

Opportunity to own a home faster:Taking out a bad credit enables you to start your journey to homeownership faster instead of waiting


Higher rates:You will be required to pay higher interest rates if you have poor credit history.

Bigger deposit requirement: you will be required to make a higher deposit in other to secure a mortgage if you have a bad credit

You can remortgage with bad credit, but it’s worth trying to improve your credit score if time permits you. Ensure you make your monthly mortgage repayments on time as it will help you to build a stronger credit history. If your credit rating has increased after a period of time with a specialist lender, it may be possible for you to remortgage with a high-street lender. Your ability to secure a better rate depends on your income, credit score, property’s current value as well as the equity you hold in it. Affordability calculations will be ran by the prospective lender to ensure that you will be able to afford payments at the new rate in future.You are required to pay fees to remortgage, and you should also factor that into your decision-making.A varied range of remortgaging deals are available on the high street, with good rates, you just have to search.[/vc_column_text][/vc_column][/vc_row][vc_row el_class=”seo-link-sec”][vc_column][vc_empty_space height=”50px”][vc_column_text][slick-slider category=”28″ design=”design-5″ speed=”2000″][/vc_column_text][/vc_column][/vc_row][vc_row el_class=”call-out-sec stretch-sec” css=”.vc_custom_1568018042545{background: rgba(0,0,0,0.88) url( !important;background-position: center !important;background-repeat: no-repeat !important;background-size: cover !important;*background-color: rgb(0,0,0) !important;}”][vc_column][vc_column_text]

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Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of our Independent Mortgage Brokers to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisers working for or with Independent Mortgage Brokers are fully qualified to provide mortgage advice and authorised and regulated by the Financial Conduct Authority. All our independent Mortgage Brokers will offer advice specific to you and your needs and circumstances. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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