Finding a mortgage broker if you have credit problems

If you have had difficulties with bad credit in the past, you may be apprehensive about applying for a new mortgage. The blame for the global financial problems of recent times has been laid squarely at the door of ‘sub prime’ lenders – those who specialise in giving mortgages to people who have poor credit histories and who represent, to the mortgage lenders at any rate, a greater risk of defaulting than those who score better. Although many of these sub-prime lenders are based in the United States, there are plenty in the UK as well. You may be concerned that the credit crunch has lowered your chances of securing a mortgage with any lender – sub-prime or otherwise.

When you carry out a search to compare best mortgage quotes on the internet, you will likely be deluged with adverts for mortgage brokers who specialise in ‘bad credit’ or ‘sub-prime’ clients. These will typically charge higher fees than regular mortgage brokers, because they appear to be offering a service that others would not. Customers assume that these are the only brokers who will touch them, and end up paying the higher fees because they think there is no choice in the matter.

Sub-prime mortgage brokers – what to consider

It is worth knowing that most regular mortgage brokers will also work with sub-prime borrowers. Not only that, they will typically offer the same fees that they charge everyone else. You may have to pay more for your mortgage itself, and the type of deal you can get may be more limited because of your financial circumstances (past or present), but you should not have to pay over the odds for the advice and you can still go through a reputable mainstream broker.

This simply means that searching for a mortgage broker if you have a poor credit history should be much the same process as if you did not. Word of mouth is often a good place to start, and if you know someone who can make a good recommendation based on their own experiences then this can be invaluable. Other than that, the Internet is a great resource for finding brokers in your local area. By all means compare best mortgage quotes themselves at the same time – there are several search sites that will do this for you – but bear in mind that a broker will be able to secure deals that you will not on your own.

Finally, there are things you can do to improve your credit score with the lenders. Some are as simple and apparently unconnected to your finances as making sure you are on the electoral roll. Access to too much credit – unused bank accounts and credit cards – can also affect you adversely. Keeping up regular payments on your existing credit card debts will obviously make a difference, as will stability in your living arrangements and in your job.

Steven Clarke – Marketing Manager – The Mortgage Broker – Providing a mortgage comparison of the whole mortgage lender market to find you the best mortgage loan rates. Visit the Mortgage Broker to get a quote on the type of mortgage you want.