Catering to the needs of borrowers with an extremely complex or adverse credit history is an area of the mortgage market that is often overlooked. Although this specialist area of mortgage lending has grown significantly over the last few years, it is important to note that there are also varying degrees of specialism within the sector itself.
Rising living costs and higher interest rates have squeezed the affordability of many borrowers in recent years, which has resulted in higher demand for more tailored underwriting and specialist lending solutions.
While this evolution of the mortgage market and subsequent growth of specialist lending is fantastic for broadening the range of products available to this type of borrower, not all specialist lenders are cut from the same cloth.
Each lender will have its own product offerings, lending criteria, level of risk and degree of flexibility when it comes to underwriting mortgage applications. This is particularly true in the first charge mortgage market, where the lending criteria and risk profiles of lenders can vary hugely.
Understanding the various nuances among specialist lenders can prove crucial in those situations where a broker may encounter a client with extremely complex or adverse borrowing requirements.
In fact, some specialist lenders may even shy away from this type of borrower who may be considered unsuitable for borrowing or too high risk, particularly those with multiple credit defaults, extremely complicated borrowing needs or even a combination of both.
This is where Norton Home Loans (NHL) can help. As an established lender with over 50 years’ experience in the specialist lending market, NHL has always helped borrowers that do not fit in to the mould of mainstream lending.
Recently, this approach extends to the specialist lending market, where we continue to help brokers find solutions for those clients with extremely challenging financial backgrounds who may struggle to secure a mortgage with other specialist lenders.
While we of course also have lending parameters and affordability checks in place to help us assess applications, we also understand that life isn’t always black and white and that everybody doesn’t fit into the same box.
Having over five decades of experience also means that we are familiar with dealing with those clients that perhaps other lenders do not want to touch. We also understand that a low credit profile or a history of missed payments or CCJs doesn’t necessarily mean someone should be excluded from borrowing.
While this type of borrower may be well be deemed higher risk, it doesn’t necessarily mean that there isn’t an appropriate solution for their needs. It simply means it may take a bit longer to assess all the relevant information and documentation and find a possible and suitable outcome.
For example, our first charge mortgage product range is available to a broad range of customers including those with a history of adverse credit or payday lending older than 12 months. Those with more recent blips within the last year can also be considered for certain products.
Applications from borrowers with a bankruptcy charge or debt relief order that is over three years old will also be considered, as will those holding a CCJ over 12 months old and those within an active IVA.
While many lenders do not offer borrowing under £50,000, applicants requiring a micro loan of £3,000 upwards will also be considered by Norton, making us a viable lender in situations where the client may need a smaller loan. We will also lend on a variety of unusual and different property types.
Catering to the needs of clients who require a specialist first charge mortgage, especially those with extremely complex backgrounds, is essential in helping those borrowers who may otherwise have nowhere else to turn.
Our experience, expertise and track record in dealing with, and successfully handling, high level specialist cases, means we understand how to work with brokers to help them find a solution for their clients’ needs.
Providing greater flexibility, understanding, and tailored solutions when it comes to handling complex cases, means the needs of these borrowers can usually be met. It also means more brokers can help clients achieve their property goals in situations where other lenders may fall short.
