Can I get a Help to Buy Mortgage with Bad Credit?
With the Government’s intention of building more properties under this scheme, the number of High Street lenders entering the H2B mortgage market has increased considerably and this is also true when it comes to Adverse Credit Mortgages Lenders. 5% deposit can be paid by the Builder!
A few years ago you would only have been offered a mortgage from 1 or 2 lenders if you had a poor credit history but now I know of 6 Specialist Adverse Credit Mortgage Lenders prepared to consider applicants who have had Defaults or CCJ’s – one lender offers mortgages if you are a discharged Bankrupt or you are still in an IVA or have had mortgage arrears. Some lenders are OK to lend if you are in a Debt Management Plan providing you have kept the payments up to date.
Do you Qualify for Help to Buy Property?
You are eligible if:
- You are a First Time Buyer or Homeowner looking to move
- The home you want to buy must be newly built
- The purchase price cannot be higher than £600,000
- You cannot sublet
- You cannot enter a Part Exchange deal on your old home
- You must not own any other properties
- You must have a 5% deposit but this could be a gift from your family
How to buy a Help to Buy property?
Stage 1 – Look for a H2B property in the area you would like to live by contacting the local Housing Association, Builders in that area or Estate Agents.
Stage 2 – Once you have seen a property you like, complete the H2B ‘Property Information Form’ (PIF) which is basically an application to see if you qualify under the H2B Scheme. At the same time contact me to run through your finances and credit history to see if you could get a mortgage.
It would help if you have a copy of your credit file available from Check My File as I will need to read the report to see how good your credit history is. Here is the link.
CMF provide data from the 3 credit reference agencies used by lenders – Equifax, Experian & Call Credit – so it is a good place to start to get an overview of your credit history. It maybe that once I have identified a lender, we get copies of your credit file directly from the agency the lender uses to make absolutely sure your credit history is OK for that particular lender.
There are free reports offered by Equifax (Clearscore) and Call Credit (Noddle) but I recommend Check My File
Stage 3 – On receipt of your ‘Authority to Proceed’ form back from the Housing Association having submitted your PIF, complete your mortgage application (with me) and instruct a Solicitor. Do not instruct a Solicitor before we know who the lender is as lenders have strict guidelines on who can be appointed. I can help you here buy choosing a Solicitor that would be accepted with the lender we arrange the mortgage with.
Stage 4 – Exchange, Complete and move in!
Here is a link to a very good document that explains in greater detail the H2B buying process.
And to find your local Help to Buy Agent click on this link.
Help to Buy Agents administer the H2B scheme and have the authority to give you the go ahead for you to purchase a home. They can also guide you through the options available and explain the eligibility and affordability criteria.
For more information on Help to Buy Mortgages, please call me on: 01494 526400 or complete my online enquiry form.