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Loan to Value (LTV)
The ‘loan
to value’ or LTV is the ratio between how much you want
to borrow and the lenders valuation of the property - so
if you wanted to borrow £75,000 on a property valued at
£100,000, the LTV would be 75% with a 25% deposit
(£25,000)
Bad credit mortgage
Baker
Financial would suggest a
minimum
10% deposit
Bad credit remortgage
Baker
Financial would suggest a
minimum
20% deposit or equity
The LTV
is determined by a number of factors and we have listed
the main ones below as a guide. We would strongly
recommend speaking to a specialist broker such as Baker Financial if you want
to apply for a mortgage or remortgage with 'bad credit'
- contact us today.
The main
factors affecting LTV where bad credit is concerned are...
Bad
Credit type
This is
the type of bad credit a person has - missed payments,
defaults, CCJ’s, IVA, discharged bankrupt etc
Bad
credit mortgage’s allow combinations of bad credit types
such as a number of missed payments, defaults & CCJ's -
Baker Financial have access to all these different
mortgage products.
Number
of Bad Credit items
The
amount of the different types of bad credit.
You could
have 3 defaults and 1 CCJ, which will fit on a certain
mortgage product, but if you had 1 default and 3 CCJ’s
the mortgage product would probably be different.
Some
lenders work of the number of bad credit items rather
then the amounts such as – upto 3 CCJ’s registered
rather than the CCJ’s individual or total pound (£)
amount.
The
pound (£) amount of the bad credit
The
actual amounts in pounds (£) you owe - you could have 1x
default for £3,000, 1x CCJ for £1,000 and another CCJ
for £300 - some lenders work off totals (such as - upto
£10,000 total CCJ’s) & some work of both number and
pound amount (i.e. max 3 CCJ's not totalling more than
£10,000)
When
the bad credit was registered
The date
bad credit items were registered on your credit file is
an important factor to be considered. Some lenders view
'bad credit' registered some time ago differently than
more recent 'bad credit' and may not take certain bad
credit issues into account depending on when it was
registered.
Your
‘status’
Your
‘status’ simply refers to your ability to prove income.
If you
are employed with wage slips or on contract / self employed with
certified accounts you would apply for a ‘status’
mortgage.
If you
are on contract or self employed and are unable to
provide satisfactory proof of income, you would apply
for a ‘non status’ or ‘self cert’ mortgage
Baker
Financial Specialise in bad credit mortgages &
remortgages
You
can view the number of bad credit items, when the bad
credit was registered and the pound (£) amount of each
individual credit item by getting hold of your credit
report and letting us explain what the information on
your report means in real terms.
-
apply for your credit report
There are
other factors which determine the LTV (such as property
type) - but the ones listed above relate directly to bad
credit mortgage and remortgage applications.
All mortgage
lenders have their own criteria for deciding how much
LTV they will allow and which mortgage product has what
maximum LTV, there are literally thousands of different
mortgage products to choose from and getting the best
available could save you a small fortune over the life
of your mortgage - we would
recommend speaking to a bad credit mortgage specialist.
use our experience to get the best
results possible
– contact
us today
you may be interested
in
jargon buster
about credit
reference agencies
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