When assessing your eligibility for a Home Reversion Plan or Equity Release Lifetime Mortgage, lenders tend to assess the application differently when it comes to those that require an adverse credit mortgage or adverse credit re-mortgage equity release scheme.
The reason for this , is that the lender is not reliant on the borrower keeping up with a monthly mortgage payment, and they have the guarantee of their money back when the property is sold.
However, a lifetime mortgage or a home reversion plan are not guaranteed for those requiring adverse credit mortgages in the UK, and lenders will consider applications on a case by case basis. In some instances they may consider agreeing to an adverse credit mortgage or remortgage where the applicant has either a CCJ or default, but not in others.
There are several key requirements to be eligible for an equity release mortgage, which are as follows.
- The youngest applicant must be aged 55 or over,
- You must be a homeowner,
- You must be a UK resident.
- If there a mortgage on the current property, this will need to be repaid on or before completion .
- The property can not be used as security for any secured borrowing after the equity release scheme is completed
- A suitable buildings insurance policy will need to kept in place during the life of the mortgage.
- If there is anyone else living in the property aged 17 or over, they will be required to consult an independent legal adviser and sign a ‘Deed of Consent’
For those aged 55 or over suffering with an element of adverse credit, a Lifetime Mortgage or re-mortgage may be the only option available to them in the current climate, and where a standard mortgage for those with a poor credit history are not available.
Adverse credit mortgages, adverse credit re-mortgages, and finding the right solutions for your needs can prove to be very complicated. The whole subject area is one that often gives people more headaches than they can afford.
However, if you take advantage of the FREE Equity Release Consultation provided across the whole of the UK by Key Retirement Solutions, your appointed equity release adviser will be able to assist you in identifying what if any Equity Release or Home Reversion Plan provider is able to accept your current credit status.