New mortgages target buyers with defaults and County Court Judgements

A specialist lender is reintroducing a suite of mortgage products aimed at what it call “overlooked customers”.

It turns out these are buyers who have credit histories including County Court Judgements (CCJs) and payment defaults.

Aldermore says these mortgages are specifically designed to do three things: help get first time buyers onto the property ladder, provide greater mortgage choice for the self-employed, and offer mortgages to customers with historic credit issues who are struggling to get a loan elsewhere.

The mortgage products are organised over three levels of criteria, dependent on the customer’s credit profile. All of them will ignore combined county court judgements and defaults up to £300 per applicant:

- Level 1: rates from 5.44% with a £1,999 fee, up to 95% LTV;

- Level 2: rates from 5.84% with a £1,999 fee, up to 95% LTV;

- Level 3: rates from 6.34% with a £1,999 fee, up to 80% LTV

Level 1 and 2 mortgages will be available up to 95% LTV.

For Level 3, historic mortgage loan arrears, CCJs and defaults from six months are permitted; and a maximum of three missed unsecured loan payments in 12 months are allowed, as long as the customer is currently up to date.

Aldermore says that one in five UK adults has a poor credit score, meaning that there are potentially millions of people with historic credit issues who are held back from buying their home or struggling to remortgage.

Aldermore’s most recent first time buyer Index, a study of FTBs and their experiences in purchasing a property, discovered that 17% of prospective FTBs reported having poor credit history and 23% were rejected for a mortgage.

Jon Cooper, director of mortgage distribution at Aldermore, comments: “We’re aiming to offer more people the option to achieve their homeownership goals. We back people to go for it in all walks of life; more choice for borrowers, increased resources for broker partners and ultimately, greater outcomes for those we serve. These latest changes cater to the diverse needs of today’s homebuyers, with Aldermore’s expert team on hand to unlock new possibilities for our customers.”