There are a small number of specialist lenders who offer mortgages and remortgages for people who would normally fail a standard credit check with a mainstream lender. Some specialist lenders don't credit score, instead they individually assess each borrower's circumstance with an open view. You will need to able to show you've got any historical debt issues under control and that you are managing your finances responsibly.
As a specialist mortgage adviser, we assist people with low credit scores including people who have been turned down elsewhere. Contact us for free initial no obligation advice. We'll let you know whether we'll be able to help you get a mortgage.
A lender's assessment of your ability to repay a mortgage will usually take account of not only your income, but also your credit scoring profile. Lenders are increasingly using sophisticated credit scoring techniques to determine whether consumers qualify for a mortgage. The assessment methods exclude a large number of people including individuals who have difficulty proving their income and people who have experienced past credit problems.
Credit scoring involves assessing the probability that a mortgage will be satisfactorily repaid by the borrower based on an analysis of data provided on the application form and information available from the individual's credit file.
Credit scoring typically involves assigning points to a range of applicant and credit history characteristics predictive of the applicant's performance, and then adding these together to generate an overall credit score.
Mortgage applicants usually have to reach a minimum score to obtain a mortgage. Scores may also be used to determine the terms and conditions of the mortgage, such as the loan amount, interest rate and period of the loan. For example, an applicant with a good credit score may be able to borrow more than an applicant with a poor credit score.
Lenders often use data from credit reference agencies to review the credit history of an applicant. Credit reference agencies such as Experian and Equifax are able to provide lenders with a range of raw and structured data on the applicant, such as information on county court judgements, bankruptcies and insolvencies; payment performance on existing and previous credit commitments; and outstanding borrowing commitments.
An individual with a history of repayment defaults, county court judgements or bankruptcy will usually return a low credit score and will normally be declined by a mainstream lender. However, lenders employ widely differing techniques to determine an applicant's creditworthiness, meaning a person with a poor credit score is more likely to be accepted by a specialist lender whose has less stringent lending rules.
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