Today, families throughout the country are struggling financially because of the recession, rising prices and loss of jobs. It is unfortunate that when finances are limited, mortgage payments are late or missed altogether. This results in not only stress for the homeowner, but also the falling of credit scores.
A homeowner who is experiencing this type of problem with finances may have the option of a poor credit remortgage to help relieve some of the financial stress. This type of loan is basically an exchange of a homeowner’s current mortgage for one that has more favorable terms. Many times a remortgage can save someone money each month but also help some save his home from foreclosure.
Poor credit remortgages have become very popular among homeowners who want to better a bad value mortgage and switch to one that provides better value for money and savings over the life of the loan. Monthly payments might be lowered or delayed and making up missed payments may be avoided. It may also be possible to access the equity in the home to consolidate bills or get cash for needed expenses.
A remortgage is a secured loan and has benefits for someone even with poor credit. The repayment terms and interest rate are both flexible and the amount that is borrowed is many times more than imagined. Current income is used as the criteria for the loan instead of the initial income that was provided when the original mortgage was set up. Securing a poor credit mortgage is like starting over but with a home that is already secured by the loan. This is an opportunity for the borrower to get finances back in order and make better payment dates.
A poor credit remortgage is especially designed for homeowners who suffer from poor credit ratings and are looking to save money and solve monthly financial difficulties. Someone with poor credit normally has arrears, late payments, defaults, missed payments, insolvency, bankruptcy, etc. The applicant of the loan can stay with the same lender or choose a different one. If a new lender is chosen is it likely higher fees will be charged. Staying with the same lender often times provides better deals with better interest rates.
Benefits of a poor credit remortgage
1. A chance to take advantage of current products, such as discounts and fixed or competitive rates
2. An opportunity to get away from a displeasing lender
3. Improvements credit rating
4. Helps to increase the equity in the home
5. Improves homeowners ability to repay the mortgage
6. More favorable terms and conditions (lower interest rates and monthly payments)
Remortgages are available today to consumers who have good credit as well as poor credit. However, if a homeowner has a poor credit history or a poor credit rating, he or she will not have as many deals available and usually have to pay a slightly higher interest rate than someone who has good credit.
It is important to do a lot of research and comparing when looking into poor credit mortgages; many remortgage lenders need to be compared to find the best deal and which one will save the most money. This can be done quickly and easily both in person with a lender as well as on the Internet. With the number of lenders today and the wide variety of choices, most any homeowner with poor credit can find a remortgage that best suits his or her needs.
For homeowners who suffer from a poor credit rating due to bankruptcy or late payments, remortgage may seem impossible. This is somewhat true in a financial market where lenders have placed more restrictions for borrowers to get a loan. However, in this time of financial hardship, this is the perfect time for a homeowner to look into the very popular choice of a poor credit remortgage.