A history of CCJs, arrears and bankruptcy is no longer a barrier to gaining a home loan from Charcol...
A history of CCJs, arrears and bankruptcy is no longer a barrier to gaining a home loan from Charcol.
The new package offers borrowers with adverse credit a home loan which is 0.5% above the lender's Standard Variable Rate (SVR) until 31 July 2002, giving a current pay rate of 7.74%. Then it will rise to 1.5% above SVR until 31 July 2003, and 2.5% above SVR thereafter.
Charcol's technical manager Ray Boulger says Charcol is looking to help those "hit by unfortunate circumstances to get back on their feet". The package gives borrowers only two years early redemption penalty fees starting from the day the mortgage is taken out, and there is potentially no lock-in after the cheaper SVR period has finished.
"With such a short early redemption penalty period, those who maintain their mortgage repayments without getting into anymore problems should be able to remortgage to a mainstream deal within two years and therefore benefit from an even cheaper home loan," Boulger says.
Boulger is keen to stress that "a less than squeaky clean credit history will not necessarily limit borrowers mortgage options solely to the sub-prime market.
"Increasingly a number of mainstream lenders will consider people with black marks against their name, depending on the circumstances of the debt and how long ago it happened."
The Charcol package allows borrowings of up to 80% and has an arrangement fee of £295 up to £250,000 and £495 over £250,000. A history of any amount of CCJs and defaults is acceptable, as is any amount of arrears, except where a remortgage is from another sub-prime lender. In this case proof of last three months payment is required. Bankruptcy and IVA are also acceptable providing the applicant has been discharged for at least six months.
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