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Downsizing/remortgaging with the same bank - Does credit rating matter??


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Hi all, first time poster here, hope someone can help :???:

A couple of questions really.....

 

1. Does your current credit rating affect your remortgaging options?

2. When downsizing, do you have to re-apply for a new mortgage if staying with the same bank (and undergo all the checks etc), or is it just a case of "adjusting" the current one you have?

 

In our particular case, we are downsizing to a smaller house which won't require any extra borrowing, we will stay with C&G, we have always been on time with payments (for more than 5 years).... the only issue is we have developed a bad credit rating in the last couple of years.

 

Thanks for any help. Much appreciated :wink:

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Hi, I'm in a similar position with C&G, I want to down size but would still need a mortgage of about £40,000.

My mortgage at the moment is £97,000. I am now unemployed though so the C&G have told me they wont give me another mortgage, I have never defaulted.

So I am stuck here and will eventually not be able to pay the mortgage, the DWP have just cut the help they give to people with mortgages even though I was getting less than people who pay rent.

I 'ported' my mortgage from my last house to here as I did not need to borrow any more money but I still had to fill in forms so they would probably know your financial details.

Its not getting any easier. Good luck though.

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Thanks sj01, I guess we're in a slightly better situation in that we're both in employment. We will have a badly damaged credit rating soon (sizable mortgage shortfall from another property that we can't afford to pay) but apart from that I think everything would be ok. So it's just a question of how high up the banks check list the credit rating is for an existing customer changing their mortgage, along with affordability and financial security.

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Hi Sulksy

 

I think the chances of a lender giving a fresh mortgage without a credit check are virtually non-existant. However, if you are staying with your current lender then the impact a bad credit rating has is likely to be lower, because if there is any risk as a result of your financial status, the C&G are stuck with it anyway. I would suggest that the important question is whether or not the new mortgage will increase or decrease the risk for C&G. By that, I don't just mean the monthly repayment but the loan to value ratio etc.

 

You suggest that your rating is going to be hit badly. Does that mean it hasn't been yet? If so you might want to get your remortgage sorted out asap. If it has already been damaged then it might be best to visit the lender and discuss it. I know that other posters will say that in reality all lenders tend to be less sympathetic in real life to those in trouble than they like to pretend, but in your case, I think this is probably the best route, unless anyone knows different?

 

FYI - I don't know if it helps but I recently extended a portion of my current mortgage that was being paid paid over a shorter period, to match the length of the main mortgage. That was to reduce the monthly repayment. All I had to pay was a £50 fee. My lender (Chelsea) did not undertake any kind of credit check. Maybe changing your mortgage term, even for a short while, would be another option?

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Hi sulksy, been there and tried it without success. My lender would allow a transfer to another product without doing a credit search but advised me that to offer a new mortgage on a different property or to increase my borrowing on my present property then the would do a full search and they were unlikely to be in a position to offer me any mortgage.

It seems stupid not to allow someone who currently is able to pay full amount towards a large mortgage a smaller amount on another property to allow them to reduce their outgoings but lets face it if the banking sector were as bright as they like to make out then we would not all be in the mess we are in.

sleepindog

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