I have a friend who needs to remortgage with a subprime lender who's looking for some advice to make it as risk free as possible. They currently owe about 90k on their current mortgage, their house is worth about 420k, and they want to increase their mortgage to about 170k (i.e. an additional 80k). The reason they have to go subprime is that her husband has a really bad credit rating. They have quite a few loans that they can't pay back and the longer they leave it the worse their credit rating will get. They have recently had a judgement lodged on their house regarding a loan to AIB of approx 13k and there's a threat of another judgement coming. Two years ago they were refused a topup loan of 25k from their current lender because of his bad credit rating even though they have never missed a payment with them.
Their current monthly loan repayments are - mortgage 700, loans 750 (fixed for 3-4 years, no missed repayments) and another 800 re loans defaulted which is proving impossible to pay back in full each month. They are in their early 40s. They also need some money to replace their car and do some essential work on the house, so the additional 80k would be used approx 60% to pay off the loans and 40% for the house and car.
So it looks like the only way they can get out of their situation is to remortgage with a subprime lender, pay everything off and start improving their credit rating, with the intention of moving back to a normal lender as soon as possible.She rang MABS the other day and they said they cant give specific advice (i.e. suggest particular lenders), but that she should read the small print on any mortgage offer very carefully. She is going to go to a broker next week and see what they say.
So to anyone who has dealt directly with any of the subprime lenders, can you please tell me which are the more unscrupulous ones, or what your experience has been of dealing with them? She'll be looking for a term of 20 years max, and for the flexibility to move in a few years time with no major penalties (if she's lucky enough to get approval with a normal lender in a few years) and since they are expected to come into some land shortly which they will sell, they would like to be able to pay off a lump sum off the mortgage without any penalty. What should she be looking out for? How can she protect herself?
Their current monthly loan repayments are - mortgage 700, loans 750 (fixed for 3-4 years, no missed repayments) and another 800 re loans defaulted which is proving impossible to pay back in full each month. They are in their early 40s. They also need some money to replace their car and do some essential work on the house, so the additional 80k would be used approx 60% to pay off the loans and 40% for the house and car.
So it looks like the only way they can get out of their situation is to remortgage with a subprime lender, pay everything off and start improving their credit rating, with the intention of moving back to a normal lender as soon as possible.She rang MABS the other day and they said they cant give specific advice (i.e. suggest particular lenders), but that she should read the small print on any mortgage offer very carefully. She is going to go to a broker next week and see what they say.
So to anyone who has dealt directly with any of the subprime lenders, can you please tell me which are the more unscrupulous ones, or what your experience has been of dealing with them? She'll be looking for a term of 20 years max, and for the flexibility to move in a few years time with no major penalties (if she's lucky enough to get approval with a normal lender in a few years) and since they are expected to come into some land shortly which they will sell, they would like to be able to pay off a lump sum off the mortgage without any penalty. What should she be looking out for? How can she protect herself?