Bad Credit Loans
Bad Credit loans are available and can save people hundreds of pounds per month and allow them to get back in control of their finances.
Bad Credit Loan – The Situation
Despite their sizable income, our clients were struggling to repay their borrowing. Whilst they were making regular payments, the outstanding balances of their credit cards and loan didn’t seem to be going down! Previous bad credit history meant than many current leaders wouldn’t accept them with a previous IVA getting a secured loan was proving difficult.Between the two of them, our clients owed a total of £35,200, made up of just under £19,000 on credit cards and £17,500 on car loans, with total monthly repayments of £992.75.
Whilst this was affordable for the customers they were conscious that they weren’t borrowing as responsibly as they could, and that they were paying unnecessarily high rates of interest with no plan for clearing the overall debt.
They owned a house worth £280,000 with an outstanding mortgage of £210,000, with 12 months still to run on their current mortgage product.
Their broker was having difficulty in arranging a remortgage, both as a result of their unsecured debt impacting on the lender’s affordability criteria and because the extra borrowing would take their borrowing to close to 90% LTV – And this would see the rate they were paying on ALL their borrowing almost double.
On top of this, the customer would also need to pay some £3,000 in early repayment charges.
Bad Credit Loan Solution
We were able to offer the couple a highly competitive second mortgage, leaving their existing mortgage and repayments unaltered, this also meant they could avoid ERCs. The second mortgage will repay all the customers’ existing unsecured borrowing.
As the customers are happy they can afford the payments and want to clear the debt as quickly as possible, the loan has was quoted over a 10-year term, giving repayments of £468.11 – less than half their current payments!
And, as the lender allows unlimited overpayments, simply by paying the same amount as they were paying on the unsecured debt, the customers will have repaid their debts in approximately 3 ½ years – allowing them to borrow more responsibly and face the future debt free!
Bad Credit Loans
Can be available upto 85% – 90% in some cases, your income and circumstances will determine what risk bad credit lenders will take.