For those looking to make the next move or take their first steps onto the property ladder, having to set aside a hefty deposit can be out of reach which is where some government house buying schemes can make all the difference. Whilst having bad credit can make it harder to get a mortgage it is still possible to qualify for a help to buy mortgage with guidance and advice from the right people.
- What Is a Help To Buy Mortgage?
The governments Help to Buy scheme was created to help first time buyers and existing homeowners to buy newly built properties with just a 5% deposit. The scheme includes an equity loan which allows buyers to borrow 20% of the purchase price (40% in London) interest free (for the first 5 years only) which therefore increases the prospective buyers deposit to a much more appealing 25%.
- Who is Eligible for a Help to Buy Mortgage?
There are some stipulations as to who can and cannot apply for the scheme, but most people are eligible if they fit the following criteria;
- You are a first-time buyer or homeowner looking to move
- You do not own any other properties
- You are looking to buy a new build property
- The purchase price does not exceed £600,000
- You have a 5% deposit
- Is It Possible to Get a Help to Buy Mortgage If You Have Bad Credit?
Whilst having bad credit or a bad credit history can potentially make it harder to get a mortgage, it is far from impossible. It might limit the range of mortgage deals available to you and the mortgage is likely to be a little more expensive but there are a number of ways to help overcome a less than ideal credit rating and climb the property ladder.
If you have problems securing a mortgage, have a bad credit score or issues with your credit history then seeking advice from a financial expert who specialises in Help to Buy Bad Credit mortgages is advisable. This means that you get help and guidance from a reliable, knowledgeable professional who will likely have access to and relationships with specialist mortgage lenders. These specialist lenders are often able to provide Help to Buy mortgages in cases where other lenders wouldn’t such as for those who have;
- Defaults and CCJs
- Missed and late payments
- Debt management plans
- Mortgage arrears
- Where Do I Start?
Before you apply for a Help to Buy mortgage it is always best to find out your current credit score and check your credit file in order to identify any potential issues such as defaults, CCJ’s or missed payments. This can be obtained from agencies such as Experian or Equifax and will provide a detailed breakdown of the credit commitments made over the past 6 years.
Attaining a Help to Buy mortgage with bad credit is a specialist area and if you are unsure of the next steps or are concerned about what you have found out then it is advisable to seek out a mortgage advisor with experience in this field. They will be able to find out if you qualify for a Help to Buy mortgage, advise you on the best path to take based on your individual circumstances and help find the right mortgage scheme for you.