Credit History
All lenders use a credit bureau the check the status of applicants for
mortgages. A search of a bureau should reveal important information about
the applicant, including current obligations, track record on previous
ones and Country Court Judgment's (CCJ's).
Where debts have been incurred in the past, the bureau records will indicate
whether these have been satisfied or not. In addition to this information
being available to the lender, applicants can also request the credit
file (subject to a maximum fee) held on themselves - this is a legal entitlement
under the Data Protection Act 1984.
If Country Court Judgment's (CCJ's) appear on the credit search and have
been satisfied subsequently, the lender will usually insist on seeing
evidence of this. Documentation to this effect can usually be provided
by the former creditor by way of receipt or other confirmation.
If the information on the applicant demonstrates a good history of servicing
borrowings, the lender will naturally be more prepared to enter into a
mortgage contract than if the applicant has a poor record.
Information obtained from credit bureau is only relevant to the comparatively
recent past - records are usually deleted after six years.
The lender will take a much more selective attitude when considering loans
to those who have been subject to insolvency proceedings in the past.
A bankrupt has a legal obligation to disclose their bankruptcy to their
solicitor. Whilst a bankruptcy order is still in force, a mortgage cannot
be granted to the person who is subject to it. There is nothing to prevent
a discharged bankrupt from entering into a mortgage, however, other than
finding a lender prepared to lend.
Lenders take a serious view if misled deliberately by a mortgage applicant.
If it is discovered that incorrect information has been given to support
the application, it will be declined on principle. In very serious cases,
the lender will notify the Police, who may decide to bring a prosecution
for fraud.
If a client has had financial problems resulting in measures of the mentioned
above being taken against them, it is obvious that this will cause problems
when trying to place the mortgage.
Your home may be repossessed if you do not keep up repayments
on your mortgage.
A fee may be charged for advising on or arranging mortgages of between
1 and 3% of the sum borrowed. The exact amount will depend upon your circumstances
but we estimate it will be 1% of the loan amont.
The overall cost for comparison is 9% APR.
The actual rate available will depend upon your circumstances. Ask for
a personalised illustration.
