The number of people with bad credit rating has increased, but, where does that leave people with Bad credit histories?
These are some tips to get a better bad credit mortgages.
1. How Negative is your bad credit history?
If you have only missed the odd payment or been late with a credit card payment, you may still be able to borrow from traditional lenders. Always check a variety of standard mortgage lenders first, they may have different criteria for what constitutes a bad credit history.
2. Bad Credit doesn’t necessarily mean lack of affordability.
Have you addressed the fundamental reasons for poor credit in the past. Are you able to meet future payments? Just because you have a bad credit history doesn’t mean you shouldn’t try getting a mortgage. It is likely to be more desirable than renting, however, it is important to make sure you can really afford the mortgage and not just get one, because you feel obliged to.
3. Fixed Rate offers stability.
If you have struggled meeting payments in the past, consider a fixed rate mortgage. This allows you to plan with greater certainty and confidence.
4. Beware of introductory Balloon Deals.
These are mortgage deals which offer a very attractive 2 year rate, but, then rise very significantly. These are sometimes known as teaser deals, because they seem very attractive, until repayments increase after the first 2 years. These balloon mortgages were a significant cause behind the mortgage crisis in America.