Securing a mortgage with a history of adverse credit can be challenging, particularly when there is also pressure to complete within a short timeframe. Previous defaults can limit the number of lenders willing to consider an application, while a tight deadline can make it even more important to identify the right option from the outset.
Enness was approached by a young couple in their early twenties who were looking to purchase a property in Greater London. They had found the firm through an online search and contacted us on a Friday afternoon to explain their circumstances.
The property was a three-bedroom end-of-terrace house valued at £298,000. The borrowers had a 10% deposit and three historic defaults on their credit files, all of which had since been satisfied. Having previously been declined by a high-street bank, they also faced pressure from the vendor, who was seeking a prompt sale.
OUR SOLUTION
Enness identified a lender that was prepared to consider the borrowers’ previous credit history and the fact that the defaults had been satisfied. Following an initial discussion on Friday, the necessary information was gathered and supporting documents were provided on Monday.
The application was submitted on Tuesday, with a valuation arranged for Thursday. This allowed the mortgage process to progress within the timeframe required for the purchase.
The final mortgage was a 2-year fixed rate at 2.74%, with a £999 product fee added to the loan. Enness also explained the relevant protection and insurance considerations associated with the purchase.
This case demonstrates how specialist lenders can provide options for borrowers with historic adverse credit where mainstream lending may not be suitable. Careful preparation and an understanding of lender criteria can also be particularly valuable where a property purchase is subject to a tight deadline.
Disclaimer:
This case study is for illustrative purposes only and does not constitute financial, legal, tax or investment advice. Finance is subject to status, underwriting, affordability, property suitability and lender criteria. Terms, rates, LTVs and availability may vary depending on individual circumstances.
Risk Warning:
Your property may be repossessed if you do not keep up repayments on your mortgage or other borrowing secured against it. Property values can fall as well as rise.
Information contained in our case studies is for market and illustrative purposes only. In some cases, these may be made up of multiple cases and are for illustrative purposes only.
Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
