In times of rising interest rates and spiralling household debts, some people are left with no option other than to reorganise their finances in order to avoid bankruptcy.

One of the most popular methods of gaining relief from unmanageable debt is through Individual Voluntary Arrangements (IVAs).

The popularity of IVAs increases after long periods of low interest rates and excessive borrowing that are followed by periods of rapidly increasing interest rates. This is because the cost of the money previously borrowed will increase.

When this situation occurs, people who have over borrowed are forced to find solutions to their debt problems as they can no longer afford to keep up with their loan repayments.

An IVA is one of several ways of reorganising debts and using any surplus household funds to make repayments each month. IVAs are not an easy way out of debt and the rules are strict.

An alternative to IVAs is a debt consolidation loan. A debt consolidation loan is also called a bad credit mortgage and is secured against the borrower's home.

A bad credit mortgage allows for individual debts to be consolidated into one loan and the amount that can be borrowed will be based on the equity value of the applicant's home.

A bad credit mortgage can make the repayment regime of various individual debts more manageable as their will only be one monthly repayment amount to pay each month. This can help considerably with household budgeting.

When credit cards, personal loans, store cards, and other debts are consolidated into one bad credit mortgage, the loan products that originally had a shorter term will now have the same term as the bad credit mortgage. This means that although the amount of the monthly payments reduces, more money is repaid in the long term.

Neither an IVA nor a bad credit mortgage represents an easy way out of financial difficulties.

If you are facing debt problems, advice should be sought from debt counsellors and independent mortgage brokers in order to discover whether an IVA, a bad credit mortgage, or a different option altogether is the best solution to your debt problems.

When times are good, times are very good. When times are bad, homes are repossessed. It is safe to say that the good times are over for home owners who have a mortgage to pay off and like clockwork the repossession industry is shifting up a gear.

The ability to sustain repayments on a mortgage can change rapidly. There are many home owners who have secured properties during the past few years who are now facing the prospect of losing their homes because they can't keep up with their monthly mortgage repayments.

Property affordability has dropped considerably in the last few months as interest rates rise and lending criteria tightens. While it is easy to use hindsight to see that many home owners who are facing the prospect of losing their home should not have leapt onto the property ladder in the first place, it is more sensible to focus on the issues that they should have considered before applying for a large mortgage.

When assessing whether or not to buy a property, a prospective borrower should first look at whether or not the mortgage they wish to apply for is simply too big. It sounds so simple - and that's because it is. Mortgage lenders offer products with income multipliers of more than five times an applicant's salary these days which is more than twice as much as it used to be.

This raises the question - why the increase? Twenty years ago lenders assessed that borrowers could only afford a mortgage of about two to three times their annual wage. Why are they now suggesting that borrowers can sustain a mortgage of five times their salary?

Even if a borrower secures a mortgage that they can afford at present, potential future changes in the terms and conditions attached to the mortgage and potential changes to the household budget should be accounted for.

The most obvious factor that can, and probably will, change is the mortgage's interest rate. When interest rates increase, monthly repayments on variable rate mortgages also increase. When fixed interest rate periods expire, the interest rate payable on a fixed rate mortgage may also increase. Both of these scenarios will result in an increase in the monthly repayment amount due on the mortgage and will therefore lower its affordability.

Finally, borrowers should factor in the possibility that their income may reduce. Any reduction in a household's income will naturally lead to the mortgage, as well as other bills, becoming less affordable. There are various insurances available to mitigate reductions in income and borrowers should research this carefully when applying for a mortgage.

Borrowers who plan ahead and factor in potential changes in the variables detailed above will have a much better chance of funding their mortgage through the bad times and therefore holding on to their home.

If a person owns a house, his status automatically rises in society. Such people are often seen to be privileged residents. They are also entitled to various other benefits that may be related to the banking sector. If a homeowner is interested in availing of a loan to purchase another house, he usually gets extra benefits. Because he already owns property, he may be given the most flexible plan available. This enables such house owners to take their own time in repaying the loan. The great thing is that simultaneously, they are making a good investment in the world of real estate.

Homeowner loans are given to those people who already own a house. Such people can use the money in any way that they wish to. It could be to decorate the house, or purchase a new vehicle or just about anything that they may be interested in. The loan companies tend to give these customers more priority over others. Why do they indulge in such preferential treatment? It is because the house owner will be placing his/her property as collateral. Homes mean security in many ways. The lenders are as interested in minimizing their risks as are we. Thus, they tend to be more enthused about getting into deals where collaterals are involved. After all, this does ensure that the amount that was lent will certainly be repaid soon enough.

While talking about repayment, one should realize there are different modes of repayment that are available. Thus, a house owner who is looking for a loan has a wide variety of options to choose from. He could avail of loans that charge interest at flexible rates. He could look for plans that offer repayment of only the interest. He could even look at plans where the borrower can repay the interest separately and the principle amount separately as well. In countries like the United Kingdom, homeowners are offered unsecured loans as well. But, the thing about secured loans is that the lender is assured of payment in case the borrower happens to default. Secured loans require collateral, and in case of non-repayment, the home might be sold to pay off the dues. Even if the person concerned has a bad credit score, he will be given a home owner loan to help him tide over whatever financial dilemma he may be in. However, he will also have to offer some form of security before he can avail of the loan. This will hold true for even those people who have multiple CCJs or a track record of defaulted payments to their name.

When you apply for a home loan with a mortgage broker you expect that broker to be professional, honest and work on your behalf to get you the best loan rate and terms. That's what happens in 99% of all mortgage broker transactions but what about that dishonest 1%. What are the common mortgage broker tricks they play and how can you protect yourself from them?

The Common Mortgage Broker Tricks

The Old Bait and Switch: This is the most common trick played on borrowers. Usually the mortgage broker will advertise and extremely low rate. Borrowers respond to this advertising and find out that the low rate offered is either on a short term ARM or that it will cost the borrower thousands of dollar in points and fees to buy the rate down to the low level.

Solution: Always ask the mortgage broker to provide yo with a Good Faith Estimate for the loan program being offered. The Good Faith Estimate will break down loan terms and fees so that you can make an informed decision. You should also avoid mortgage companies that use this tactic altogether.

Rate Switched at Closing: One of the classic mortgage broker tricks and very obvious to spot but it is still used by the slimiest of the slimy. Basically the mortgage broker promises all along a rate and loan program the borrower wants. Then the borrower gets to the closing table and what was promised to them is completely different. This mortgage broker trick is more common in purchase transaction then in refinances but is equally frustrating to the borrower in either situation.

Solution: Always get a Good Faith Estimate and a Rate Lock Letter that is signed by you and the mortgage broker.But the bottom line is that if you were lied to you should get up from the table and walk away. There is no law that says you have to close the loan if you are unhappy with it.

Scaring The Borrower: This is one of the most common mortgage broker tricks but it is not as well known as the other ones but is used a lot more. What the mortgage broker does is find out why you are refinancing and use it against you to charge more fees and get a higher commission. For example if you are adding an addition onto your house the broker will tell you to go ahead and start the project because your loan is 100% guaranteed. They will then call you usually a day before closing telling you either your credit score dropped or loan program guidelines changed and you now need to pay for a lower rate or switch to a higher interest rate loan program. Many borrowers may be startled and stressed into closing the loan. Because it is so effective this is the most popular of all the mortgage broker tricks that dirty brokers play!

Solution: Ask for documentation to support the credit changes. Any change in credit status can be clearly shown on the credit report. If the mortgage broker cannot support their claims call another mortgage company or bank and ask them to quote you a mortgage loan.

Although the vast majority of the nations mortgage brokers are honest there is that small percentage that are not, knowing the mortgage broker tricks that they play and how to spot them can save you unnecessary emotional and financial stress when you need a new mortgage!

With more and more people running into financial trouble that is unforeseen or otherwise, people are looking to obtain bad credit loan mortgages in order to fulfill their dreams of home ownership. These types of mortgages are specifically for those folks who are unable to qualify for a traditional mortgage because of less than desirable credit scores. As a result of these missteps in their credit history, lenders view bad credit home loan mortgages as a higher risk.

Mortgages For Home

Home loan mortgages have been positioned as the only way for some to purchase homes these days. Also, as home loan guidelines become stiffer and stiffer, more folks are seeing bad credit home loan mortgages as a plan B. But just because you're in the market for a bad credit loan mortgage doesn't mean you shouldn't still look for the best deal for you.

The Rate is Very Important

It's best to explore various options when it comes to finding a good rate as these are different from lender to lender. And if you are one with bad credit and looking for a bad credit home mortgage loan, know that your rates may depend on your circumstances. This means that your flexibility with the mortgage lenders should be at an optimum level.

Interested in the Interest

And it may seem like your mortgage loan balance grows at a faster pace than you thought it would. This is because your interest rate may have changed, causing balance growth with no adverse affect on your monthly mortgage loan payment. A bad credit home loan mortgage may also have additional financial baggage attached such as PMI and origination costs.

Interest rates may vary according to the circumstances, location, and severity of the bad credit. Interest rates on bad credit mortgages are likely to be significantly lower than the rates on your existing unsecured debts such as credit cards and personal loans. So this is actually more advantageous than letting such personal debt chew you up

Credit

Seemingly the one thing that could keep a person from becoming a home owner or not seems to be a person's credit rating and score. Taken from special reports from lending institutions and banks, this number is very important to your mortgage financing needs. The threshold between credit worthy or not credit worthy lies at the feet of those making these decisions based on your credit score.

Home Loan Mortgage Lenders

If you are seeking a bad credit mortgage your quest for redemption should start with those mortgage lenders who are more likely to help you. Ideally these lenders should have bad credit home loan mortgage within the top tier of their mortgage products. These lenders are happy to help you with a second or third chance. They'll work with you on things such as rate and mortgage insurance.

Mortgage Loan That Are Below Prime

Yet another way to go when it comes to getting a bad credit mortgage is a sub prime loan. Although they are typically higher in interest rate than by sometimes as much five percent than prime loans are, they can serve the purpose is helping secure much needed financing.

No longer the uncatchable goal, getting a home loan mortgage is more possible in this time in history than anytime before now, even to people with bad credit. Bad credit mortgages make home ownership as commonplace as owning a car or any other big ticket items.