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Mortgage rates drop for borrowers who have previously suffered financial setbacks

Mortgage rates drop for borrowers who have previously suffered financial setbacks

  • Average two-year deal for those who have defaulted on a debt down .13 per cent
  • Five year fixed rate deals have risen slightly, to 4.92 per cent

Mortgage rates for borrowers who have previously suffered financial setbacks have fallen in the past six months.

The average two-year fixed rate for a homeowner who has defaulted on a debt or received County Court Judgments (CCJ) is 4.36 per cent, down from 4.49 per cent in October, according to Moneyfacts. 

On a typical £150,000 mortgage over 25 years, repayments would now be £822 a month.

The average two-year fixed rate for a homeowner who has defaulted on a debt or received County Court Judgments is 4.36 per cent, down from 4.49 per cent in October

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Average three-year fixed rates have seen an even bigger fall, from 4.51 per cent to 4.21 per cent, reducing a typical borrower’s monthly repayments to £809. 

But five-year rates have risen from 4.76 per cent to 4.92 per cent or £870 a month. 

The rates are still far higher than those available to borrowers with no bad credit history who could currently get a two-year deal at just 2.48 per cent.

So-called credit impaired mortgages are typically offered by specialist lenders so you would need a mortgage broker to find them.

Online Mortgage Adviser says inquiries from borrowers with historic credit issues jumped by almost 50 per cent in the first three months of the year, compared with the same period in 2018.

In March, Virgin Money said it would consider applications from borrowers who had had defaults and CCJs in the past.

s.partington@dailymail.co.uk

Read more at DailyMail.co.uk


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