Unfair Mortage Rates

nealnomoney

Hi People

I am new to all this so please forgive, just registered for the forums today!

Me and my other half recently purchased a house. We are paying a very high interest rate because of my credit history, it is impaired. On the other hand my partners credit history is perfect. We thought long and hard about the high monthly mortgage payments and decided to go for it as it was what we really wanted and we were no able to purchase the house on our own. Anyways, what i am trying to say (or ask) is there any sort of product on the market that would cater for this type of problem. Why should my partner be paying this much because of my history?

Surely there should be someone who considers both applicants status and calculates the rate accordingly. Why should someone (my partner) with an excellent history be paying for a sub prime mortgage????

Please advise or comment. Thanks :sad: :sad:

AndrewSmith

HI and welcome to the forums. I cannot promise to tell you what you want to hear but I do not believe in patronising people so I will tell it to you as it is.

Me and my other half recently purchased a house. We are paying a very high interest rate because of my credit history, it is impaired. On the other hand my partners credit history is perfect. We thought long and hard about the high monthly mortgage payments and decided to go for it as it was what we really wanted and we were no able to purchase the house on our own. Anyways, what i am trying to say (or ask) is there any sort of product on the market that would cater for this type of problem. Why should my partner be paying this much because of my history?

There are lenders who cater for this sort of issue. They assess the case based on the lending risk to them taking into account the credit history of those applying. If one or both of the applicants has impaired credit then it will affect the rate any typ eof mortgage you are offered. It sounds like you have the type of product that fits your situation.

Surely there should be someone who considers both applicants status and calculates the rate accordingly. Why should someone (my partner) with an excellent history be paying for a sub prime mortgage????

The reason that your partner is paying a sub-prime mortgage rate is becasue she is now financially associated with you and is party to a joint mortgage with you, who has an impared credit history (by your own admission).

Lenders have no obligation to give a mortgage at all, and do so at an appropriate rate as they see fit in relation to the risk involved for them to lend the money.

Like I said, not what you want to hear but thats how it is I'm afraid.

nealnomoney

I dont think i have the type of product that fits my situation. Its just a standard sub prime mortgage, i dont not believe that my partners history has been taken into consideration.........

hearts

These companies are in the risk business to make money. "fair" doesnt come into it. They offer you a product at a price. You have the option to say no. As long as you are not tied to it for too long. You can change lenders in the future when your history of payments will improve the look of your application.

AndrewSmith

nealnomoney wrote:

I dont think i have the type of product that fits my situation. Its just a standard sub prime mortgage, i dont not believe that my partners history has been taken into consideration.........

Yes it has, but so has yours.

The fact is that you are jointly and severably liable for the mortgage debt and are financially associated. Therefore if one or more of the applicants has adverse credit history it will impact on the product offered.

Don't forget that they actually have no obligation to lend you anything and could have declined it all together.

DavidHM

If you truly feel that both your circumstances are not being taken into consideration then presumably there are other products on the market that would have offered you a better rate. If so, why didn't you take them?

If there aren't then your mortgage company might be making a fortune out of you but at least it's a smaller fortune than all the others - the best I can say is that I hope you're not tied into the rate for a long time.

Eventually if you maintian the payments your credit history will improve and you can remortgage and get the good rate you think you deserve.

The only way your history wouldn't come into it would be if your partner could support the mortgage on her own - in which case she could, and probably should have made a single application.

fivemice

Perhaps think of it this way -

You have poor credit history, and say you split up with your partner, run off and stop paying the mortgage. Your partner is then liable to continue paying the mortgage, but he can't afford to. The lender now has to repossess the property.

Of course this is possible with any couple, but I suppose the lender would say that is more likely as you because you have a bad record.

You and your partner are "judged" as one unit, one risk for one mortgage, rather than as two seperate individuals.