Will I get a Mortgage

Many of us have at some point reached a critical stage where the debts are mounting and the income just doesn't stretch far enough. If you are applying for an adverse credit mortgage the chances are you have reached that point in the past.

You may have consolidated your debts or paid them off. It is possible to rebuild a credit history and that can be through taking out new loans or a mortgage. This may sound ironic but if you do take out a loan and pay it off it will add to your credit history and over time future lenders will look more kindly at offering you products with a more competitive interest rates. If you are planning on applying for a mortgage it is probably not the right time to apply for other credit such as store cards, credit cards or loans.

Luckily, many lenders today realise that times have changed and situations occur that are not always within our control. In fact lenders take into consirderation the amount of adverse credit you may have had and will put you into a band that is either light adverse which is usually for debt problemes of less than £500 to medium and heavy. Taking out a mortgage when you have a history of bad credit will automatically mean your rate of interest is going to be higher than for a standard product. This is because you pose a greater risk to your lender.

Once you have repaid your mortgage for a period of years (usually 3) you can approach your lender and swap your product for a standard one with lower interest. Your lender will be much happier to offer you a lower interest rate and you will have recouped 3 years of history. Of course during this time you must not make sure you do not default on any payments and keep any additional borrowings to a minimum