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    • Get a Mortgage With Bad Credit

      Date: 2010.03.21 | Category: Mortgage | Response: 0

      In the old days if your credit history was less than perfect, the only mortgage you would be offered would be one with extortionate interest rates from a shady broker.

      Nowadays, there are more sympathetic lenders who will offer you a bad credit mortgage without charging you sky-high interest charges. And because there are more lenders out there now offering these non-standard mortgages, it has driven the interest rates on them down which is good news!

      The term Bad credit can be anything from County Court Judgements (CCJs) on your credit file to something like having missed a mobile phone payment or made a few mortgage payments late.

      More and more people now have a bad credit file. Rising inflation and credit companies making it easier for people to borrow means that just because you have a bad credit file, you are not rubbish with money!

      So, what can you do to get a mortgage, without being ripped off by greedy lenders?

      First of all, if you are considering using a mortgage for debt consolidation, do bear in mind that it will probably cost you more in interest in the long run. And also the debt will be secured against your home, so you must really ensure that it is affordable to you.

      And when it comes to choosing a mortgage, do not apply for the first mortgage that you see. TV adverts saying that they can help people with bad credit are all very well but many of them charge as much as a 3% fee to arrange a sub-prime mortgage. So, on a 150,000 mortgage, they get 4,500!

      Get independent advice from an independent mortgage specialist as well as doing your own research. Bad credit no longer has the financial stigma it used to, so hold out for the right deal for you.

      How the web can help you if you are looking for a bad credit mortgage

      If you have a poor credit history, finding a mortgage specifically for people with bad credit can be difficult. And even if you do find a mortgage, how do you know that it is the right one for you?

      Using the internet can help. There is tons of information on there relating to bad credit mortgages such as free guides, as well as access to providers of bad credit mortgages.

      Going online also allows you to compare multiple providers so that you can look at all the product features and benefits to decide whether it is right for you.

      There are also websites that accept online mortgage applications and there are hundreds that offer free and immediate online quotes. This means that you can see how much you can really afford to pay out for a mortgage.

      Steps to improve your credit rating

      If you have recently applied for credit and have been turned down or you have been offered credit but at higher interest rate than advertised, then this is probably because of your credit rating.

      Even if you never miss payments or do not have any debts such as a loan or credit card, you could still have a low credit rating.

      This is because you can be penalised if your credit record is empty. Prospective creditors like to see positive entries on your credit fie and if you have no financial history, they are unable to judge how well you manage your credit.

      The solution is to develop your credit file by adding positive entries on your record. Running bank and savings accounts as well as paying your mobile phone bills on time are a good start as are well managed credit card and store card accounts.

      If you do not have any credit accounts, then gradually apply for them. Dont apply for lots of credit all one go as this will look like you are in financial distress. Instead, get one card at a time with a low credit limit and pay the balance off in full every month. Open up a bank and savings account. And pay your bills on time even the small ones!

      Start building a financial history gradually and over time you will find it easier to get credit, and at a better interest rate too.

    • Fixed Rate Mortgage Advice

      Date: 2010.01.17 | Category: Mortgage | Response: 0

      One of the most important decisions you will make in your financial life is which mortgage you should get. For many people, the option of a fixed rate mortgage seems appealing. But what exactly is a fixed rate mortgage, and why do so many people choose this option? If you are new to mortgages then this article will let you know a little more about fixed rate mortgages and their benefits.

      What does fixed rate mean?

      A fixed rate mortgage is fairly straightforward, and does exactly as the name suggests. A fixed rate mortgage has an interest rate that remains the same throughout the mortgage term, meaning that your monthly repayments will remain the same, allowing for inflation of course.

      Why a fixed rate mortgage?

      Many people choose fixed rate mortgages because of the security and peace of mind that they provide. If you have a fixed rate mortgage, then you know your monthly repayments will not change, meaning you can budget effectively for both the short and long term. If you have a mortgage with a variable rate of interest then your payments can change depending on market fluctuations. This can leave you paying less, but often leaves you paying more each month. The best times to get fixed rate mortgages are when competition is high, and the fixed interest rate is lower than that of the tracker or variable rate mortgages.

      Are there any drawbacks?

      There are drawbacks to getting a fixed rate mortgage. The biggest drawback is that the interest rate is usually higher than that of variable rate mortgages. The added security comes at a price, in that you have to pay more in interest over the length of the mortgage. Also, the fixed rate is usually only fixed for a certain number of years, usually 2 or 3, after which the rate can be put up and then fixed for another period. This can mean that your mortgage will be cheap now, but in the future the rate could rise.

      Who should get fixed rate?

      Despite its drawbacks, there are many people that should definitely opt for fixed rate mortgages. If you are on a tight budget and have a fixed income each month, then you cannot afford for your payments to rise. Having a fixed repayment each month means that you know you can make the payment even if national interest rates rise. Also, if you can get a deal whereby the starting interest rate is lower than that of a variable rate mortgage or even the same, then opt for the fixed rate mortgage.

      How to decide?

      If you are still unsure about whether or not a fixed rate mortgage is right for you, then consult an independent financial advisor. They will be able to help you find the best deal, as well as tell you whether or not the base interest rate is going to fall or rise. This will determine whether a fixed or variable rate mortgage is best for you.