Do You Have A Credit Problem?
Not every UK homeowner can get through life without occurring some debt and not always your fault. Here we try to tell you what is classed as credit problems, credit checks explained and available routes for borrowing money.
Credit Problem - defined
This term is used to describe a homeowner who has problems or previous difficulties repaying borrowed finance. You may have CCJ's, Mortgage Arrears, Bankruptcy and other credit debt repayment problems. Abusing credit or failing to meet credit repayments leads to gaining a poor credit record. Other terms used to describe this are Adverse Credit, Bad Credit, Poor Credit History and Non Status.
Having any of these does not stop you applying for a Secured Homeowner Loan from Lower UK Home Loans .com and discovering what rate we can get for you.
Factors that are classed as credit problems:
- Arrears -
Mortgage Arrears is used to describe missed, late or under paid mortgage
repayments. If you stay in arrears you are likely to end up with a
County Court Judgment or CCJ. This can also be described as defaulting
on your mortgage or Mortgage Defaults. A limited number of lenders will
consider lending credit to people with previous credit problems.
- CCJ or County Court Judgment -
If you have not managed to keep up payments on any debt you have then you will be taken
to Crown Court. If the debt isn't satisfied then a decision or judgment
is made in the County Court. Normally for the non-payment of that debt
it will
be registered on your credit file as a CCJ. If the debt is paid or
satisfied and a satisfaction certificate obtained it will be noted on
your credit file. Having unsatisfied CCJ’s will seriously effect your
credit rating and limit the lenders available to you.
- Bankruptcy - (Discharged From Bankruptcy) - After a period of time a Bankrupt
Individual can be discharged from bankruptcy. This then releases them
from their financial obligations. There are some lenders that will
provide homeowner loans for ex-bankrupts.
- Defaults - If you have defaulted on a loan or mortgage it means that you are more than 30 days behind the date your repayment was due. This will be marked on your credit record and would lead to a CCJ if no payment was received or received very late.
Credit Checks and more for Homeowner Loans
All your credit history will be stored on databases by credit reference
companies. A lender will check these to find out your credit status. If
you have a severe credit history and your record will be black listed to
note severe risk. Some lenders will still lend on this but the interest
rate will be high until you can improve your credit history.
- Credit Check - A lender will do a credit check to
ascertain your credit rating. A credit check determines your credit history whether you have
any CCJ's, defaults or outstanding credit card bills using the services
of a credit agency (Experian or Equifax). Most high street lenders don't
want anyone with a poor credit history.
- Credit Scoring -
This process is used by most lenders to determine what level of credit
risk you are. They use a scoring system based on credit history; good or
bad, length at current address, security, employment, income and
answering these questions gives them a score or Credit Rating.
Mainstream lenders only want high scores. However there are lenders who
will find credit to suit your score even if it is a poor credit rating.
The majority of your credit history and suitability will be on a
national credit database but it is up to individual lenders whether the
risk is acceptable.
- Credit reference agency - When assessing your application, a mortgage lender will study your records. These records are held centrally by credit reference agencies, and contain information for many different aspects of your life.
