Mortgages, Remortgages, Secured Loans and Personal Home Loans
37. In financial trouble
If you are in financial trouble and can not seem to get a loan or a mortgage it may be down to your credit rating. You may have missed repayments in the past or got into a dispute with another financial provider, this all counts against you. Whenever you are turned down for a financial product that counts against you too, perpetuating your adverse credit.
The best way to claw your way back is to try debt consolidation. This may be a bad credit mortgage or a bad credit loan or even an Individual Voluntary Arrangement (IVA). What happens is you bring together all your debts into one product. You consequently just pay one creditor, either the lender who supplied you with the bad credit mortgage or a bad credit loan or the supervisor of the Individual Voluntary Arrangement (IVA).
How much you pay back each month through debt consolidation depends on your circumstances. It is essential that your monthly payment is affordable and you can continue to pay it over the length of time stipulated. If you don’t your adverse credit rating will just get worse and you will never be able to get out of the downward spiral of debt.
Bad credit loans and bad credit mortgages last as long as you still have debt to pay off and so have adverse credit. If during debt consolidation, you are paying out each month less then you were before you took out the loan or mortgage you may incur additional interest as the term of the credit agreement has been extended.
With an Individual Voluntary Arrangement (IVA) the period you will be paying your repayments and how much you are paying each month (subject to an annual review) is set. Once the term of the arrangement ends any remaining debt is cleared.
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