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Remortgaging with Bad Credit

Remortgaging with bad credit is within the realm of possibility for most home buyers. Read on to find out how you can do exactly this!

Bad credit mortgages aren’t the easiest things in the world to come by. With a multitude of lenders conducting affordability assessments to see if you’re a responsible borrower, having a poor credit score doesn’t exactly bode well. So what’s the deal if you’ve got a poor credit score and you’re looking to remortgage? Read on and find out!

The impact of having bad credit:

Ok, we’re not going to beat around the bush. Trying to get a bad credit mortgage can be a lot harder than getting a more conventional mortgage deal. Lenders who are willing to take on the increased risk of offering someone with bad credit a mortgage will either want more equity in the property or will charge a higher interest rate to mirror the risk.

Luckily for you, we provide a service where we can compare thousands of different mortgage deals from loads of different lenders. This means we can help find the right bad credit mortgage deal for you! We know that bad credit scores can create problems when you’re looking to remortgage. What we can do is tell you what the impact of certain problems on your credit file should pose and most importantly, the deals where you’ll be in with a chance of getting!

Is it possible to remortgage with a poor credit rating?

When lenders are working out what credit score they give you, they take into account a number of factors from your credit history. They are also going to consider other circumstances concerning your age, expenditure and income among other things.

It’s important for us to note that not all lenders out there in the property market are going to give you a credit score. However, all lenders are going to check your credit history. Don’t worry if that’s confusing for you. In essence, what it means is that if you’re trying to get a remortgage and you have a poor credit history then this means that if you go to lenders that give you a credit score, your score isn’t likely to be amazing.

But fear not, readers! There are always solutions to these sorts of things.  If you’re worried about the possibility of not being able to remortgage with a poor credit score or you have no credit score then we recommend that you start looking at lenders who are comfortable with low score applications.  While they might seem hard to come by at the moment, lenders like this do exist in the property market. They can offer a far more lenient view on borrowers with a poor credit history or those without one at all. So, make sure you do your research on bad credit mortgages! It’ll be instrumental to finding the best remortgage deal for you!

Is it possible to remortgage with defaults on your credit file?

Having defaults on your credit file is one the more common reasons why you might have your mortgage application rejected. Getting a bad credit mortgage with defaults on your credit history is becoming increasingly common. While this doesn’t mean that remortgaging with a poor credit score is easy, it does mean that you have options open to you.

What we’ll say is that remortgaging with defaults on your credit file is certainly a possibility but there are still loads of different factors that are going to influence your affordability. For example, your LTV (loan to value). With your LTV, the bigger your deposit is, then the smaller your LTV will be as it will mean that your lender will not have to lend you such a large amount compared to the property value. This is a good scenario for your lender, mainly because they have the security in the property. If you stop paying your mortgage & the house is repossessed then, even with legal fees etc the lender is pretty much guarunteed to get their money back. If you only have a small deposit then this is not going to be the case so the lenders exposure is increased. 

Despite this, even if your previous defaults have not been paid, this won’t spell the end of your hopes of remortgaging. While it will damage your credit score, not all lenders check this and if they do, they seem to place a lot more emphasis on when the default actually was.

Will I be able to remortgage if I’ve been previously bankrupt?

In short, yes, you can. But this is going to make life way harder. On the other hand, there are a few lenders in the market at the moment who are willing to consider mortgaging people with a bankruptcy. In instances like this, what lenders are going to take into account is how long you have been discharged from your bankruptcy. They’ll also look at how big the deposit on the new home will be and if you have a general history of bankruptcy and repossession.

These are all factors that lenders who are willing to offer bankruptcy mortgages are willing to take into account, especially if you are looking to remortgage.

How we can help at Mortgages Online

Look, we know that trying to remortgage with a poor credit history or get a bad credit mortgage isn’t easy. That’s why we’re here to help. At Mortgages Online we can compare loads of different bad credit mortgages in the current property market from hundreds of lenders to help find the best deal for you. So, if you feel like you’ve got a few more questions that need answering after reading our article, then no problem! Just make sure you get in touch or take a further look at our website! We’re simple and free to use (that’s right, no credit card needed). Use MO for your mortgage search.


Laura Waller

Laura Waller has been working in the mortgages industry since 2013, joining an independent brokerage in Essex. Laura has CeMAP 2 & 3 – Certificates in Mortgages Advice and Practice. Since then Laura oversees marketing for Mortgages Online, using her experience and expertise to write articles and blogs about mortgages and related topics.

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