Bad credit remortgage is one of the increasingly common terms used to describe a remortgage application that falls outside the lending criteria of the mainstream High St lenders such as Nationwide, Abbey, Halifax, Northern Rock, Barclays, Lloyds TSB, HSBC and Nat West. Other phrases that describe this type of home loan are adverse remortgage or poor credit remortgage.

All lenders have to assess the risk of lending you money to refinance your home. To do this underwriters will take into account a number of factors. Eg: age, employment status, loan to value, amount required. However in the majority of cases the most important factor is your credit status.

If you have got mortgage arrears, defaults, no proof of your income, county court judgements, IVA’s, previous bankruptcy, or any other “black mark” on your credit file, the chances are that you will not pass traditional lender’s credit scoring.

Until recent years this “failure” of the credit score may well have excluded you entirely from obtaining a mortgage or remortgage. However since the mid-1990’s a number of new, centralised lenders have begun lending to individuals who do not fit the “normal” criteria. Lenders you may not have heard of, as they don’t operate on the high street, but lenders who are owned by huge financial institutions, such as GE, General Motors, Morgan Stanley, Merrill Lynch, Lehman Brothers and the Halifax to name a few. Specialising in bad credit remortgages and mortgages, they have developed sophisticated pricing systems to allow for the extra risks they take on. They distribute their mortgages through intermediaries like Home Loans.