Who Needs A Bad Credit Home Mortgage Loan?

Do you need a bad credit home mortgage loan? It can sometimes be difficult to decide. Many lenders group their bad credit home mortgage loan products under the general banner of non-conforming mortgages, but according to the Council of Mortgage Lenders (CML), this is a broad designation which includes far more products than a bad credit home mortgage loan.

Mortgage companies include several other products under the non-conforming banner. These may include buy to let mortgages, where someone is buying a property to rent out. They may also include Sharia home purchase mortgages, which comply with Islamic laws on interest, and lifetime mortgages, which allow the release of equity in an existing home. Some of these, such as in the buy to let sector, may also include a bad credit home mortgage loan, but many of them are entirely different.

According to the CML's research, a bad credit home mortgage loan is likely to be available in one of several common situations. For example, borrowers may qualify for a self certified bad credit home mortgage loan if their income is uncertain. This might be because they are self employed, or because they work on short term contracts. Some people make most of their money by earning commission. Such people would self-certify and might qualify for a bad credit home mortgage loan. Lenders will usually try to prevent people who are having a self certified bad credit home mortgage loan from overstating their income.

Why Bad Credit Mortgages?

While self certification may be a grey area, which may only be considered non-conforming above a certain loan to value, there are other circumstances which definitely qualify consumers for a bad credit home mortgage loan. Some potential mortgage holders have little credit history. This could be because of a nomadic existence which involved frequent address changes. People who have lived abroad for long periods could also be in this category. People in these circumstances would not be on the electoral roll, which could count against them on their credit record.

There are also other reasons for needing a bad credit home mortgage loan. These can all be grouped under the banner of 'adverse credit history' though the specifics may change depending on where in the UK you have lived. Arrears on rent payments, arrears or defaults on loans, decrees (in Scotland), County Court Judgements (CCJs), bankruptcy and individual voluntary arrangements (IVAs) are all reasons why someone might need a bad credit home mortgage loan.

If you do, you're not alone. According to the CML's research, this specialist lending sector is the second biggest specialist mortgage sector after buy to let. It represents about 6 per cent of the UK mortgage market. Most of the bad credit home mortgage loan products (about 80 per cent) are sold through intermediaries, rather than on the high street. This means that the best way to get a bad credit home mortgage loan is to go to a specialist broker to find the right bad credit home mortgage loan is for your circumstances.

In general Buy to Let mortgages are not regulated by the Financial Services Authority.

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