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Mortgage Glossary
Bad Credit Mortgages
 
You have a bad credit history and you would need a bigger amount of money in the future?
Do not despair; you have the chance to get a mortgage, even with a bad credit history. How is that possible? It might seem unbelievable, but it is true and in financial terms it is called a sub-prime or non-standard mortgage. Below you can read about how to get a mortgage even if you have bad credit history.

Let us start with the beginnings: what exactly is a bad credit history? Bad credit history means that you had problems with the repayment of some previous debts. This might mean that you did not pay the amounts of money on time, or did not pay at all. Also, County Court Judgments or even bankruptcy may qualify as bad credit history. Some of the debtors might not be aware about their bad credit history, because they might be late with only a few payments, or forgotten about the last rate. So it is good to check your credit history once in a while, just to make sure everything is as you know. You would think that it is impossible to get a mortgage after declaring bankruptcy, but you are wrong, and here are the reasons why.
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Nowadays many banks or other financial institutions offer different types of credit. As the needs change, they have to change their offer; otherwise they will remain without clients. A few years ago it was impossible to get a new credit if someone had a bad credit history and their credit score dropped below a certain percentage. Now, the financial situation around the world is really bad, we are in a so called economical crisis, so more institutions offer mortgages even to people with bad credit history. It is this simple: they change their offer after the needs and because of the competition. Now let us talk about how to obtain a mortgage even if you have bad credit history.

Although it is not impossible to obtain a mortgage, it might be a little harder than if you had a good credit history. Your mortgage might be little bit different: it might be offered at a slightly higher rate. Do not get alarmed yet, first you need to look for the best offer. And yes, you do not only want the best offer, you really need it. Do not sign the papers offered by the first lender, look around a little. It is enough if you take a look around on the internet, or you might want to check the local offer. This way you can find the best possible offer, and even if the credit is offered at a slightly higher rate, you won’t loose much money. And another tip: negotiate! In some cases the bad credit history is not your fault entirely. You might have gotten ill, you might have gotten unemployed or your salary just dropped from one week to another. If you can prove all this to the lender, he might make you a better offer. This is very important, so do not forget to negotiate!

Let us look at the good side! As soon as you obtained the new mortgage, your credit history will improve almost immediately. Of course, you will have to keep up with the repayments; you should not be late at all, this way you might get a fully standard mortgage. With a bad credit mortgage you can consolidate all of your bills into a single low monthly payment with bad credit home loans. As you can see, bad credit mortgages have positive aspects too, besides the negative part of the higher rate. All you have to do is think it through: do you really need another mortgage? If the answer is yes, then you should start looking for the best offer you can find. But think it through really good if you want to secure other debts with your home, because in case of non payment your home might be repossessed, and that would be really bad for you.

All in all, you can get a mortgage even if you have bad credit history; you just have to prove to the lender that you are capable to make the monthly payments. If you managed to do that, you will most probably get your mortgage. For now that is good news, but do not forget that you should pay the rates in time; otherwise you might lose your home. Keep in mind that only the fact that dealing with a credit is big responsibility, and you should cut down your expenses until you manage to pay off your debts.

You could see that it is not impossible to get a mortgage, even if you have bad credit history. All you have to do is take a look around and find the best offer!