To get a bad credit mortgage you will need a good deposit. It is very likely that you’ll be asked to put down at least 15% of the property value. The more you put down the better your chances are of getting a mortgage.
The best way to find bad credit mortgage lenders is to go through a mortgage broker. They will know of a number of lenders who offer mortgages even if you have bad credit. When you apply to a lender they will ask to check your credit record.
They do this so that they can have a look at your financial history and decide what type of risk you are as a borrower.
Get Your Credit Record
Before you apply for a mortgage it is best to have a look at your credit record. You need to see that the information inside it is accurate. If you see anything you don’t think is right, you’ll need to contact the credit agency and explain the problem to them.
If you have had a joint financial arrangement with someone in the past, the other person will be on your record. If they have a bad credit history, it could affect yours.
If you no longer jointly owe money, close any accounts you had together. After that inform the credit agency so that they can remove the person from your file.
How Do I Get My File?
There are three main credit agencies in the UK. They are Callcredit, Experian and Equifax. It is best to get your records from all three because they might not hold the same information. Just log on to each website and fill in the form to get your credit report. You can then read it online straightaway.
Talk to Your Mortgage Broker
Once you have read your credit file and you know the details are correct, contact your broker. They will look at your file and take the details of your deposit. They will then explain what type of mortgage you can apply for, for example a fixed rate or a tracker mortgage.
You’ll also be told how much interest you can expect to pay. Once all the paperwork is gathered together the broker will make the application.