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Finding A Bad Credit Mortgage
(presented by www.refinance-refinance.net - mortgage lenders)



By George Royal

Bad credit loan mortgages or non-status mortgages are purposely intended to serve people with a bad credit history. According to a recent survey, one fifth of all adults are not able to qualify for a standard mortgage as a result of a previous or current bad financial situation.

Credit history is based on information retrieved from sources including Public records such as electoral roll information, court judgments and bankruptcies; and Information provided by financial institutions and other lenders such as banks that provide credit accounts and lending facilities.

In order to calculate the potential risk in providing loans to the person, most lenders use independent credit reference agencies to gather and assemble this information since they are permitted by law to review a mortgagee’s credit report before granting approval.

Bad credit rating usually results from failure to pay off outstanding debts or other credit payments on time, due to factors such as outstanding rent or mortgage arrears, county court judgments (CCJ) or bankruptcy. There are also other reasons that can result in a bad credit record which include:

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1. Foreclosure

2. Heavy medical bills

3. Settlements arising due to Judgments /divorce

4. Multiple credit cards

5. IRS debt

Bad credit mortgage is designed for people who are unable to take out a mortgage from high-end mortgage providers. However, there are several providers who are willing to take a risk and provide loans for individuals with bad credit ratings, but at a higher rate or lower maximum amount.

Normally, a bad credit mortgage loan has an introductory interest rate that is fixed for 2-3 years, which is substantially higher that the rate pertaining to a conventional 30 year fixed rate loan. This is due to the extra risk the lender has to take, because with a bad credit, the borrower

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This entry was posted on Monday, July 17th, 2006 at 5:48 am and is filed under Refinance. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.

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