The answer is ‘yes’ – adverse mortgages (or, rather, adverse mortgage customers) are on the rise. However, for those of you who are wondering ‘what is an adverse mortgage?’, then let us explain.
The three degrees
The adverse mortgage is also known by three other names, all of which range in tone from soft to quite self-explanatory.
For example, there’s adverse credit mortgages (the inclusion of word ‘credit’ starts to give the game away). Then, of course, who aged 40 and above doesn’t remember the term sub-prime mortgage? After all, these were thrust into the limelight as one of the sources of the 2008 financial crash. Then, there’s the no-so-subtly titled bad credit mortgage, which kind of describes exactly what it is in only three words.
Regardless of how it’s referred to as, (we’ll be referring to it as an adverse mortgage here), the fact is that they all do the same thing: provide those with poor credit history with the opportunity to purchase a property.
Cost of living crisis
According to Mortgage Strategy magazine, the average consumer is worse off by £229 per month compared with 2023 – with this figure increasing to £267 for those with adverse credit.
There’s no doubt about the fact that life has become much more expensive over the last couple of years, the result of which is placing huge pressure on peoples’ finances. And, when people miss payments and individuals’ credit ratings begin to fall, then sometimes standard mortgages are no longer open to them.
However, there seems to be a knowledge gap when it comes to adverse mortgages and how they can help those with a poor credit rating. The same Mortgage Strategy article illustrated how 29% don’t know where to begin when it comes to seeking support or are too embarrassed to ask for help.
Shame free zone
As a Guildford mortgage broker that’s been helping people with poor credit secure mortgages for almost two decades, it’s important to point out that there should not be any embarrassment when it comes to having a poor credit rating – particularly in the current climate.
People find themselves with poor credit ratings for a whole host of reasons, many of which are the result of factors outside of their control.
The good news is that if you’d like to apply for an adverse mortgage (or simply find out more about an adverse credit mortgage), there are a number of options open to you.
In the first instance, we recommend calling one of our mortgage brokers in Guildford, who will be able talk you through adverse mortgages – including the pros and cons of adverse mortgages – so that you’ll be able to make a decision that best suits your needs.
Want to find out more about adverse mortgages? Contact our team of Surrey adverse mortgage brokers on 01483 238280 or e-mail info@complete-mortgages.co.uk.
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