If you are a house owner and want to raise cash e.g. for a new motor car, a vacation or home improvement – a remortgage is a superior way of releasing capital in an existing property. You could often as well get a better deal with this, making it a win-win.

Nevertheless, if you have suffered money troubles since your initial mortgage was received, you might find that definite doors are now closed to you, and that may include the door to your lender. As your conditions have changed, the very fact they gave you your initial mortgage is in no case guarantee they will agree to offer you mortgage refinancing. Even in case they do, the terms they propose can be less favorable than your current deal.

Having a bad credit reputation might be an obstacle and present a real challenge to be overcome. If you are in this situation take heart, as an adverse credit score does not necessarily mean that you will be unable to remortgage the property. There are likely to be options available to you.

To help you understand this, let’s first take a look at why mortgagees might be unwilling to propose you a mortgage refinancing.

Why Might Mortgagees Be Unwilling to Remortgage?

Most high street lenders will look upon adverse credit remortgage applications in the same way they would consider, and probably turn down, initial mortgage applications from people with adverse credit. From a financial point of view, a bad credit reputation or an existing adverse credit score is indicative of poor skills of disposition of cash assets, and this makes them a high risk for mortgagees.

Nevertheless, as with most things involving money, there are a good many of truths and myths which can get blurred. The biggest misconception is that the answer to an adverse credit remortgage application will always be a resounding ‘no’. The truth is that most house owners can obtain mortgage refinancing, even with a good many of credit issues on their history, s.a.:

Missed or Late Settlement
Debt Servicing Plan
Discharged Economic Insolvency
Non-payments (defaults)

Every case is judged upon its own individual merits.
This means you cannot guarantee remortgaging with adverse credit will be possible. Nevertheless, having said that, while every bad credit event represents a black spot on your credit reputation and has an impact on it, nobody of them has to be considered an immovable hindrance to get mortgage refinancing.

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