CCJ Mortgages
People with CCJs often mistakenly think that they are not capable of getting a mortgage. However, while it may be difficult to secure a mortgage with a CCJ on your credit report, if you take the right steps it will not stop you from owning a home.
There are of course difficulties that arise if you have a County Court Judgment against you, since many traditional lenders will not work with people that have a CCJ against them due to the fact that they view them as high risk.
This is why those seeking CCJ mortgages typically hire a mortgage broker for aid in receiving the best deal when it comes to securing a mortgage.
The first thing you should do before attempting to secure a mortgage is check to see if there are CCJs on your file as sometimes they can be issued without your knowledge. You only have a month to dispute or settle a CCJ or they stay on your credit record for the next six years.
If there is a CCJ on you record that you can afford to settle it is advantageous to pay it off before seeking a mortgage. At this point you can be issued a ‘Certificate of Satisfaction’ which will allow you to prove to the mortgage lender that there are no pending debts against you. It also shows lenders that you do settle any outstanding financial issues
Even without settling a CCJ you can still receive a mortgage if you seek the aid of specialist brokers who knows the market and which lenders will work with high risk clients. There are mortgage products available on the market for people in this situation and the proper broker can help you attain access to them.
There are some penalties that can occur with a CCJ on your record, such as a higher interest rate, but at the same time, the presence of a mortgage that is paid regularly on your record can help increase your overall credit score.
Other terms you may have to agree to are restrictions around early redemption of a mortgage and possible consequences should you miss a monthly payment, whether intentionally or unintentionally.
If you are not careful you may sign up for a mortgage that has restrictive tie-ins, large upfront fees, and a deal that overall will cost you twice as much in the long term as a regular mortgage, which is why the importance of a proper mortgage broker cannot be underestimated.
On the upside, after paying your CCJ mortgage payments regularly for three years you can qualify for a lower interest mainstream deal that people on the high street obtain. Some mortgage lenders may offer you less time to prove your reliability, but three years is the maximum that you should agree to, and should not be a problem if the mortgage lender is a reliable company.
