Mortgage For Bankrupts – Our Outline

May 12th, 2014 | By | Category: Info

It is estimated that a quarter of the UK population experience problems when applying for mortgages because of bad credit. Back in the time when only a few lenders offered mortgages to the public, a bad credit file proved an insurmountable problem. Credit impaired applicants were turned down immediately by high street lenders and the affected potential home owners had nowhere else to turn.

These days, however, there are many different bad credit mortgages available from various lenders that are aimed at assisting people with bad credit get a foot on the property ladder or refinance their home and fix their bad credit file. The home loan market has expended considerably in recent years so it isn’t as exclusive as it once was.

Bad credit mortgages can often provide finance in problem situations where traditional high-street lenders cannot help. Bad credit mortgages are available for both purchasing and remortgaging property and are available in a wide variety of situations. The severity and number of impairments will have a bearing on exactly which products are available to each individual borrower but there should be at least one product to suit each situation.

A Crowd of Information On Mortgage For Bankrupts

The term ‘bad credit’ relates to a situation under which an individual’s credit history is imperfect. This can arise from a variety of situations, including County Court Judgements, loan arrears, bankruptcy, loan defaults, and subsequent IVAs. It can also result from something as simple as a late payment on a credit card or too many credit searches within a small time frame.

However, bad credit has become so widespread that it no longer means that the people who suffer from it are automatically removed from being able to ask for a mortgage or remortgage. Dozens of lenders that specialise in bad credit mortgages have appeared on the market the last few years and many of them focus on specific niche markets, such as mortgages for discharged bankrupts.

Because of this, the market for bad credit mortgages is highly competitive and there are different products available to suit a variety of situations. It is likewise a complex market so shoppers should beware and seek expert advice before applying for bad credit mortgages.

The terms and conditions vary considerably between products and lenders, so careful research should be conducted to find the best bad credit mortgages to suit your individual situation. Some home loan products designed for applicants who suffer from adverse credit can come with large fees and restrictive terms and conditions.

Specialised mortgage lenders offer competitive products to first home buyers, self employed and business people, retirees, previous bankrupts, people, and new Australians and immigrants with a bad or poor credit history. One of the great benefits of using a good mortgage broker is that they have access to a number of these lenders and their products, so no matter what your circumstance they’re generally able to search for a suitable mortgage or home loan for you.

Mortgage brokers usually manage their own businesses. Lenders work with mortgage brokers because they effectively give the lender a bigger ‘shop front’ without carrying a traditional employee or ‘bricks and mortar’ branch overhead. Some lenders have few or no branches (but rather operate from one head office and then and partly rely on mortgage brokers to represent their products in other localities around Australia. Other lenders like the big four banks have their own branch networks, but also extend their access to customers through the mortgage broker network. The lender pays the broker fees or commissions for your business. Just as if you were to do with a bank manager or lender, these fees don’t change the interest rate you paid on a home loan. To be sure you’re being recommended to the right lender, ask your mortgage broker to show you a number of lenders on their panel, and what loan options you would be in a position to qualify for.

If in doubt, it may be good to contact an independent mortgage broker for expert advice. An experienced independent mortgage adviser ought to be able to help sort through the maze and select the right bad credit mortgages for your individual circumstances.

Choosing the wrong product may have an adverse affect on your personal financial situation which could result in even more bad credit appearing on your credit file if the bad credit mortgage chosen is unaffordable and unsuitable. It is therefore imperative to conduct thorough research before applying for a bad credit mortgage product.

Should my mortgage lendor (Washington Mutual) go bankrupt, what happens to my mortgage?
What are my risks as a homeowner if my mortgage lendor goes bankrupt or becomes insolvent?

  • You have no risk. Some other lender will buy WAMU's assets, such as your mortgage. At some point, you'll receive a notice from another lender (such as Chase), informing you that from that point forward, you make your payments to them. The terms and conditions of your mortgage will stay exactly the same as they currently are.

  • You will still owe the money on the loan.

  • RESPA says the loan will be sold to another servicing company and you will still pay as agreed it just changes the name on the check and the place it will be delivered


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