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Securing a mortgage when you have a bad credit history is not easy. It is estimated that some 25% of all mortgage applicants do not fit the profile of conventional mortgage loan companies
most of which tend to base their decision on whether to grant you a mortgage or not on what they see in your credit file. If you've ever defaulted on loans payments
have CCJs against your name or if you've filed for bankruptcy then it will show in your credit file
and go a long way towards deterring loans companies from offering you a mortgage.

For mortgage applicants who experience trouble obtaining a mortgage
or any other sort of credit for that matter
there is help available. Specialist mortgage loan providers offer a variety of loans that cater specifically for the 25% of applicants that have tried and failed to secure a mortgage through mainstream lenders. These loans include bad credit mortgage loans and self-certification mortgages
the latter of which provide the self-employed with a route to obtaining a mortgage.

The Ins and Outs of bad credit mortgage arrears loan

Bad credit mortgage loans
which are also known variously as adverse mortgage loans or credit repair mortgage loans
are designed to give those with a bad credit record the best opportunity to obtain a mortgage. Providers of bad credit mortgage loans tend to look at additional criteria other than your credit history when considering whether to grant you a mortgage or not. These other criteria vary between provider
and will also vary on a case-by-case basis
depending upon the source of your bad credit history.

Bad credit mortgage loans are generally offered at high interest rates. Typically
a variable rate bad credit mortgage product will be some 2% to 4% higher than the base interest rate
with the most severe bad credit cases being awarded mortgages at the high end of the rates scale. Additionally
applicants will be expected to lay down a larger deposit than on a conventional mortgage product. Mortgage loans providers dealing in bad credit mortgages are rarely willing to extend credit for more than 75% of the property valuation.

If you can put up with these restrictions and the fact that mortgage lenders will only offer a total loan sum of 2 or 2.5 times your income
then a bad credit mortgage arrears loan is a good thing. Not only will you be able to climb the proverbial property ladder
but
providing you keep up the repayments
you'll also be well on the road to establishing a good credit history.