As part of our mission to provide prospective homeowners with the best possible advice, we’re regularly adding important tools to this area. This page is designed to provide easy-access to mortgage resources and information, such as our mortgage enquiry forms and data controller template letters. These resources can help you speed up the application process and improve your overall situation to ensure you secure the best possible deal. Since 2009 we’ve helped many people lock in their first mortgage or buy to let, as well as families who needed to remortgage at the best possible rate, so if you’re suffering from a CCJ or default and are in need of useful guides and information to assist you, please check out our downloads below or contact our friendly team and we’d be glad to assist.
A CCJ is a County Court Judgement handed down by the county courts in England and Wales for money owed. The debtor or borrower could be an individual, a firm, a company or another legal person. If you, the debtor, are unable to pay pre-arranged payments and ignore warnings to do so, a creditor can apply for a County Court Judgement against you, which would be received via the post. As the debtor you would have 14 days to reply to either confirm by paying the funds owed, owing the creditor but a smaller sum, denying it or to attend the hearing. If it is ignored and no response given then the debt will sit against you for six years. If you decide to repay your debt within a month following the issuing of the CCJ, it will not be recorded on the Register of Judgements, Orders and Fines. Furthermore, you can dispute the judgement as wrong, or claim against them if they are in debt to you. As a result of this, some mortgage providers may refuse to give mortgages to those who have a CCJ. However, this does not mean that you cannot obtain a mortgage, you would need to source a specialist who is aware of the market and what it can give you. Those with a CCJ which has been settled are more likely to be successful in being approved for a mortgage. Furthermore, these are removed from your credit file in six years’ time, which further increases your chances. Even if you pay off the debt within a couple of months of receiving the CCJ, it will still stay on your record for the full six years. In most cases, the cost of the CCJ is considered, with more expensive ones reducing your number of potential mortgage lenders. If you have a regular, sufficient income in addition to good credit excluding the CCJ, mortgage providers may be more inclined to look past it.
IVA stands for individual voluntary arrangement, this being a formal, legal agreement arranging the repayment of debt via regular instalments of money to an insolvency practitioner. The insolvency practitioner sets up and organises the payments between the person in debt and the creditors, splitting the owed money among the creditors if there is money owed to multiple. This means that the debtor does not have to directly deal with the creditors themselves. There is an initial fee and often ongoing costs to pay for the insolvency practitioner’s service. Individual voluntary arrangements can be used to pay off debts such as bank loans and overdrafts, credit and store cards, as well as tax and utilities. Individual voluntary arrangements are suitable for people in debt to two or more creditors which amount to over £10,000. The legal binding of this agreement means that the creditors cannot chase up the debt once it is arranged. Furthermore, the agreement contains set time limits so that both the creditors and the person repaying debt both know when the repayments will be complete. Typically, the payments occur every month for a term of around 5 years; however this time period can vary. For an IVA to be approved, 75% of creditors must vote in agreement of the proposal given by the insolvency practitioner. Even those creditors who vote against the IVA proposal will have to comply to the terms if the minimum number of votes in favour of the agreement has been met.
To put it in simple terms, a bad credit mortgage is just a property loan specifically for customers with any sort of negative credit score, rating or history. These are not always offered by all mainstream mortgage providers due to the increased financial risks that come with lending to people who have had a history of debt and delayed or missed payments, whether this was for an existing mortgage or something else. However, having poor credit history does not mean you cannot be approved for a mortgage. Some providers may offer you a mortgage but with very high interest rates and increased deposit prices. It may be difficult to get a mortgage with a 5% deposit, with 10-15% being a slightly more achievable deposit price as long as your credit issues are not too severe or recent. If you happen to be able to afford to pay a 50% deposit, lenders may be more inclined to offer you a mortgage as the financial risks are reduced. Specialist providers for customers with bad credit may be more lenient in these cases, usually making their offer depending on the severity of your credit issues. These can help people who have no credit history, poor credit score, late payments and more. Lenders will also take into consideration whether you have a regular income which will be enough to cover monthly repayments, in addition to your age, expenses and various other factors.
Going bankrupt is a legal process which is put in place when someone is unable to repay their debts within a realistic time period and as a result of this, their debts are written off. Before you are officially bankrupt, your assets will be sold to pay the costs of the bankruptcy process as well as paying money to the creditors. Once you are declared as bankrupt, you will be so for the next 12 months, and it will stay on your credit record for the next 6 years. Bankruptcy is considered one of the more severe credit problems, yet this does not mean it is impossible to get a mortgage after being bankrupt. The terms of bankruptcy mean you cannot apply for a mortgage during the 12 month period, but it is possible once you have been discharged. If you wish to apply for a mortgage within your first year of discharge, there may be very strict requirements that you need to meet. It is also likely that these early post-bankruptcy mortgages will have higher interest rates and significant deposit prices of around 40%. After four years of being discharged, it is likely to be around 15%. The older your bankruptcy period is, the more lenient mortgage providers will be, bettering your chances of being approved and receiving better rates. Getting a mortgage after bankruptcy will become increasingly harder if you encounter additional financial difficulties after being discharged, as this could further damage your credit history.