However, simply because you have an adverse credit history does not



guarantee that you will qualify for an adverse credit mortgage.

The reason for this is the lender must first weigh the risks a

particular applicant poses and then make a decision to approve the application

or not. In some cases, the risk is too high and the application is

denied.

In other cases, the risk is moderate and the lending company simply

increases the interest rate to account for this.

The first step towards buying your property is to find out exactly how

much money you can borrow. In the United Kingdom, this is worked out

according to your income, usually three times your annual salary before

Tax and National Insurance are taken away i.e. your 'real' income, not

the one on your paycheck.

Some lenders will offer up to six times your salary! They're not doing

you a favour. A mortgage is a fat loan that has to be paid back.

Default on it, then go bankrupt, and you may find it impossible to get credit

of any kind.

Before taking the plunge, it's important to improve your credit rating

as much as possible. Before you fill out any applications, take

whatever steps you can to improve your credit. Pay off old loans, and once

they are paid off, ask your creditors to remove negative information from

your credit report.

If you need new, positive credit listings, and can't get a normal

credit card, consider getting a secure credit card; one which is issued

against a guarantee/collateral. This collateral is usually a deposit in the

issuing bank; you can borrow up to this amount.

An easier route is a department store credit card; make a few charges

on it, and pay them off promptly. The goal is to get positive entries on

your credit report. 'Though this sounds a little desperate, it is the

best way to establish a good credit score with a lender.

Ensure you pay all your bills on time (or before time); never later

than the due date. A positive credit history would be extremely helpful in

getting you a mortgage.

The best thing to do when applying for a mortgage is to talk to your

broker regarding the types available and the options you qualify for.

This way, you'll have a better idea of what is available and can then can

make an informed decision.

However, be aware that mortgage lenders will pay brokers commission for

custom pushed their way; it's better to make sure that you are using

an independent broker to get the best mortgage for your circumstances on

the market.

Try to beg or borrow money from friends and relatives before applying

for your mortgage, if you sure you can repay them quickly, and keep them

loving you(!) Revise your plan. How much do you really need to realise

your dream, in a practical sense?

If you end up getting a mortgage with a sub-prime lender and aren't

happy with your interest rate, remember that you can always remortgage

again later. Be sure to maintain a good repayment history and work to

improve your credit rating so you will be ready to remortgage again when

the time comes.