County Court Judgements (CCJs) are not the most severe ‘black marks’ on your credit report – but they do demonstrate to potential lenders that you have failed to pay back some or all of your debts in the past. This is a big red flag for many mortgage providers, who will immediately consider you to be a high-risk customer.
If you’re looking to remortgage, having CCJs on your credit file isn’t ideal – but there are providers out there who may be willing to overlook them and offer you a deal. Here’s what to expect from the remortgaging process if you’ve still got an entry (or entries) on the Register of Judgements, Orders and Fines.
When do you need to remortgage?
Remortgaging a property is the process of applying for a mortgage with a new lender without physically moving between locations.
There are a few reasons why you may be considering remortgaging your property. Maybe you simply want to get a better deal and take advantage of cheaper rates elsewhere. Perhaps you need to raise money for home improvements and other large purchases. You can do this by releasing cash from your existing mortgage and upping your monthly repayments or the length of their mortgage term as part of a revised agreement.
Remortgaging can also be a way to consolidate other existing debt and pay it off within your monthly mortgage payments. However, although interest rates on mortgages are often lower than on personal loans, you could end up paying more overall if you choose to take the mortgage out over a longer term.
If you’re looking to remortgage your property, the cost of your new agreement will be one of the biggest factors in your decision-making process. But there are other things to think about – such as whether the mortgage is portable, whether the lender will allow you to overpay on your repayments, what the exit fees are, and whether the term length suits your needs.
How can a CCJ affect your chances of getting a new mortgage?
A County Court Judgement (CCJ) is issued when you fail to pay back money that you owe. As you can imagine, this black mark against your credit file can have a hugely negative impact on your ability to remortgage.
Many high street lenders will refuse to lend to people who have an open CCJ, or one that has occurred within the previous 3 years.
Whilst it can be more difficult to remortgage with a recent CCJ on your credit file, there are still lenders who will accept you. Although CCJs are often a sign of other credit problems – and are rarely given in isolation – if you’re able to show evidence of a steady income and a clear credit history since the CCJ was issued, lenders are likely to look upon your application more favourably.
If you have a CCJ on your file, it’s important to partner with a broker who has experience in working with mortgage providers who are open to supporting individuals in similar circumstances. They will be able to point you in the direction of appropriate lenders, and ensure you do not negatively impact your credit rating even further by applying for mortgages that you are likely to be declined for.
Why use a mortgage broker?
Take action now to ensure you find a suitable product from a company that is more sympathetic to customers with a poor credit history. You can start by arranging a chat with one of the expert mortgage brokers here at CLS Money, who have access to a huge variety of deals from across the entire market.
We have many years’ experience in finding and securing mortgages for homeowners with CCJs. Whether you’re looking to get a better deal on your current house or flat, or you need to change products or providers because you’re purchasing a new home or investment property, we’ll work quickly and proactively to find you a remortgaging solution so you can move on with confidence.