SmartMove managing director Paul Griffin said: “Borrowers with a poor credit history have too often been penalised harshly by lenders who have tended to treat one client exactly the same as another. We have addressed this problem by treating our clients as individuals and matching them up to the most appropriate deal.
“Our medium adverse mortgage is unusual in that current monthly credit commitments are not taken into account when addressing a client’s ability to borrow for mortgage or remortgage purposes.
“This is particularly helpful for clients who want to consolidate as much debt as possible such as credit card loans and car loans into one cheaper loan but their incomes won’t allow them to pay it all off due to typical lender income multiple restrictions.
“It also suits clients that are happy with the levels of short-term debt but want to raise extra funds for say, a home extension or a new kitchen. This is often a problem because, for many clients, short-term debts affect their ability to borrow, but this deal does not take short term debt into account. So for the right client in the right circumstances this can be a real bonus.”
With the changes in place, clients will be offered the following deal, depending on their circumstances:
Light Adverse
A fixed rate of 5.69 per cent for three years. Purchase and remortgage up to 90 per cent. £3000 of CCJ’s acceptable, with any CCJ over three years old ignored and not counting towards the £3000 tally. Defaults are ignored with arrears acceptable and two missed payments in last 12 months acceptable, but none in last six months.
There is no extended tie in after the three years fixed rate has ended. An arrangement fee of £599 added to the loan. The product is portable and overpayments are allowed up to 10 per cent per year of the loan with £500 cash back payable to clients on completion.
Medium Adverse
Remortgage up to 85 per cent. The rate is a one-year discount down to 6.09 per cent with tie in redemption charges for a further two years after the discounted rate has ended. Early repayment charges of 6 per cent in first three years. Bankruptcies satisfied over a year ago acceptable, IVA arrangements similarly satisfied acceptable. Three months missed arrears in the last year is acceptable, as are two months missed in last six. £7500 worth of CCJ's acceptable with any over three years old ignored and not counting towards the £7500 tally. All defaults ignored. An arrangement fee of £495 is added to the loan.
Heavy adverse
A three-year tracker rate, currently 6.87 per cent, available up to 85 per cent for re-mortgages with unlimited county court judgements (CCJ’s) acceptable as are those with unlimited mortgage or rent arrears. It is available through self-certification of income and comes with no extended tie-ins after the three- year tracker rate ends. An arrangement fee of £495 is added to the loan.
