Secured loans for clients with poor credit e.g. CCJ’s, Defaults, IVA’s

We get many calls asking if we can arrange a loan for someone with bad credit.

The answer is a definite yes so I thought you might find it helpful if I gave you an overview.

The notes below don’t cover everything but hopefully may prompt you to pick up the phone and talk to us.

CCJ’s and Defaults

We have lenders which will totally ignore CCJ’s and defaults which are over 2 years old even if they are unsatisfied. Therefore clients could have outstanding adverse credit and still qualify for rates starting at 6.9%.

Other lenders look at the size and date of adverse credit. For example CCJ’s and Defaults under £300 can be totally ignored. If less than £3000 and satisfied they can also be ignored. Where CCJ’s and Defaults cannot be totally ignored, we have various plans where the rates will rise and LTV’s reduce dependent of the number of adverse points.

Unsecured arrears on the credit search.

Most lenders will ignore unsecured credit arrears so up to 75% LTV they don’t pose too much of a problem or affect the rate. Just watch out if the property is ex-council as the equity may be reduced.

Key Criteria & Application Guidance

Mortgage arrears

Most of our lenders only look at the last 12 months mortgage history so again up to 75% you have a few options. The 85% LTV lenders will look for a decent credit score and potentially 2 years clean mortgage history. However if there are a few small glitches, I suggest we give it a try for you. If your client still has significant historic arrears outstanding but has paid the last 12 months on time, we have lenders which will consider this as a clean case. If there are high arrears in the last year we have a number of lenders available depending on the equity and loan amounts needed.

Bankruptcy and IVA

We have two lenders which will pay off a bankruptcy up to 65% LTV. One lender will require payments to be made under the bankruptcy for 12 months. The other is less worried and will pay off the bankruptcy or IVA instantly or even prevent it being registered. We can also pay off debt management plans and remember, with the loans all being in arrears; we should look to negotiate reduced settlement figures so £50,000 of unsecured debt could be settled with a £25,000 loan.

Understanding Market Rates & Repayment Terms

Unlimited adverse credit

Don’t forget we have lenders which will look at unlimited adverse credit so even if we can’t ignore certain adverse credit as above, there are still lenders to help. As a guide loans with over 6 month arrears etc are available up to £22K at 65% LTV, £15K at 70% LTV and £10K at 75% LTV. With lower levels of arrears and ccj’s etc we can look at higher loan amounts and stretching the LTV’s upwards.

Loans up to 125% LTV

Don’t ignore high LTV loans. Whilst the maximum loan amount is £10000 and the rates are generally above £30%, we can arrange loans up to 125% LTV and accept mild historic adverse. Remember, if there is an existing second charge at a decent interest rate, these lenders will consider taking a third charge.

www.promisemoney.co.uk

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