Bad Credit Remortgages

If you dream of owning your own home there are a few obstacles that could be in your way before that dream becomes a reality. One of those obstacles for many people is that they have a bad credit history or have no credit score to talk of. Some lenders shy away from approving applications for mortgages from those individuals who find themselves in this situation, but there are bad credit remortgages available from respectable and responsible lenders.

 

Reasons for Bad Credit

There are a number of reasons why a person might have a poor credit score or a bad credit history, thus affecting their chances of having a successful application for a remortgage. You will be flagged up by the majority of lenders, as a risk, for the following reasons:

Bankruptcy Declared – If you have been declared bankrupt within the last six years it will be hard for you to make an application for a mortgage or remortgage on a current property.

Debt Management Plans – We all need a bit of help from time to time and debt management plans are a great way to consolidate your debt and manage it better. This does however put a dent in your credit rating.

Credit Card Payment Issues – If you have a credit card and have missed payments completely this will have an adverse affect on your credit score.

Mortgage Payment Issues – The same applies for your mortgage. If you have missed a mortgage payment it will have a negative affect on your credit score and impact on your ability to apply for a remortgage package.

Loan Payment Issues – Any loan that has been taken out has to be paid back on time via regular payments. If you have missed a loan payment your credit score will suffer as a result.

Minimum Payment Issues – Whether you have a store card to pay off, a credit card, loan or hire purchase agreement, if you fail to keep up with your minimum payments your credit score will not look pretty.

How to Apply for a Remortgage with Bad Credit

There are a few things to consider before applying for a remortgage with a bad credit score. Let’s take a look at the options:

Personal Debt Management – Rather than consolidating your debts through a company that specialises in debt management and payment plans, look at your situation and figure out if it is at all possible to clear your debts before applying for a remortgage. If it isn’t, work out how much you can clear in a reasonable timeframe and make this a priority.

Keep up with Payments – If you have previously been missing payments completely or been late to pay, make a concerted effort to be proactive with your bills for the near future. Getting into the habit of paying early and more than the minimum will look good for you when it comes time to apply for a remortgage.

It isn’t all bad news, however, as there are certain lenders who will still support you if you are looking to apply for a remortgage with bad credit. Even if you have been rejected by another lender, there are certain companies that will take into account more than just your credit history, allowing you to have that chance to rebuild your credit score and have the dream home you’ve been thinking of.