Is getting a mortgage with bad credit always going to cost me a fortune, or are there good deals out there?
To be frank, yes, as the lenders will price in the risk. I'm not sure whether it will cost you a fortune, but you will undoubtedlt pay more than someone with a good credit rating.
It is well worth speaking to either a mortgage broker or an independent financial adviser in these circumstances as they will have a sourcing system which will filter out the best deal for you from the whole of the mortgage market, otherwise, unless you're very lucky, you'll be wasting needless amounts of time | 12.09.10 @ 06:27
Yes, it will cost you more, and will be more difficult to obtain. However, this may be a price worth paying since a properly run mortgage (together with your other financial affairs) will help you rebuild your credit rating. In other words, once you have held the loan, at that higher rate, for (perhaps) one or two years, you may be able to remortgage for a more competitive product.
| 12.09.10 @ 10:20
'Always' is a long time, but it is likely that an individual with poor credit will always pay more than an individual with good credit at the point of application.
If you can keep yourself clear of problems for a while then credit worthiness does improve, but the question does arise, if you are someone who will 'always' have bad credit, is taking out a mortgage a good idea - lenders who offer mortgages to individuals with poor credit histories tend not to be the most patient when you run into problems.
If on the other hand it is an event that mucked you up (ill health and joblessness being the two classic examples) then show that it was a blip, even a big blip by keeping things straight now, and over time things will improve. Far quicker than you expect in some cases. | 12.09.10 @ 10:35
John makes a good point. As an example, one of my clients had to go initially with a lender who specialise with people with poor credit ratings for the first 2 years and subsequently had to pay a higher rate. Once his deal expired, we "shopped" around again and we found that as his record had vastly improved, we were able to secure a deal with Halifax at a much better rate | 12.09.10 @ 10:46