Right to Buy Mortgage with Bad Credit including Defaults, CCJs or IVA and even past Bankruptcy
Sorry if it’s a Flat you want to get a Right to Buy mortgage for then we Can’t help if you have bad credit and its likely you will have to wait until its fully off your credit report.
This article is about getting a Right to Buy Mortgage with Bad Credit looking at clients with past late rent payments, Defaults county court judgements (CCJs), IVA or bankruptcy. Unfortunately if the property is a flat we cannot help.
The key to your success in getting a mortgage with an impaired credit history is that the problems can be attributed to a certain time in your life rather than a continual trend.
When it comes to getting a Right to Buy Mortgage the choice of Lenders is very limited and not readily available to consumers directly, so you will need to enlist the services of a creditable specialist mortgage broker, such as Niche Advice, to help you through the options specific to you.
In short, we can help applicants with a small defaults or CCJ(s) on a competitive rate but over £500 in total the rates jump markedly. If you have had rental arrears then you are automatically looking at expensive interest rates.
On bankruptcies they must have been discharged for 3 years and must NOT have included a repossession, IVA too must have been settled 3 years the rates, but the rates for both are exceptional. You should also have a clean credit profile after Bankruptcy.
What I’ve done is to give you the BEST CASE scenarios below. Please do NOT call if you are outside of these parameters as I CANNOT help.
Eligibility criteria:
- ALL applicants must be on the Right to Buy Papers
- Houses only
- No deposit needed
- Potentially borrow up to 10% more than the discounted purchase price for home improvements
- Minimum joint income £25,000
- Minimum property value £100,000
- Minimum loan £75,000
- Income multiples: 3.5 times income
Supporting documents:
- Employed applicants last 3 months’ payslips
- Self employed last year’s accounts
- Last 3 months’ bank statements
- Annual rent book statement
Right to Buy Adverse Credit Products:
| Product Code: | Rates from | Missed rental payments | Adverse combination | CCJs or defaults | IVA or Bankruptcy | Loan to Value Maximum | ||||
| RTB1 | 3.69% | None | AND | 3 up to £500 (total) | Discharged for 3 years | 75% | ||||
| RTB2 | 8.35% | 2 (none in last 2 months) | OR | 3 | No | 65% | ||||
| RTB3 | 9.90% | 3 (none in last 2 months) | OR | 6 | No | 60% |
The key with any Right to Buy purchases is the end game. The council discount is normally very generous and can make home ownership affordable, and present a valuable asset. Therefore interest rates, whilst high, might be so important in the bigger picture.
We charge 1% of the loan size for arranging mortgages on Right to Buys. This is only payable on the successful completion of the mortgage when funds have been released until this point there is nothing to pay.
I shall be delighted to help you further in this regards, and are open to discuss matters personally, however if you are outside of the parameters above please do NOT call as you will be stopping the many callers who I can genuinely help get through.
Niche Advice is a specialist mortgage broker than can help with Right to Buy Mortgage with Bad Credit.
Author: Payam Azadi
Payam Azadi is a partner at Niche Advice who are whole of the market Independent Mortgage Brokers. His role is very much focused on Property financing both on residential and commercial lines. To get in contact with him please click here.
