During recent years it has been observed that many lenders are often found reluctant to finance people overlooking their poor or bad credit history.  There are however a number of lenders who deal with borrowers who have bad credit.

However, before opting for a high risk mortgage loan, it is always advisable that the borrower must find an appropriate mortgage broker and lender who would be willing to provide him/her assistance in shape of high risk mortgage loan over flexible repayment terms and conditions.   As high risk is being associated, many lenders will charge higher interest rate and sometimes a fee to spread the risk and to remain on the safe side as well.  In most of the cases, the interest rate that would be imposed by the lender mainly depends upon the credit score you carry.  This can range from as little as 1.00% above normal discount rates to 3.00% on first mortgages.   The more the poor credit score would be the higher the interest rate would be and vice versa.   Apart from this, in order to go for a high risk mortgage the borrower needs to ensure the lender that he/she is able enough to repay the borrowed amount on time.   Payroll slips of last 3 months or proof of self employment would be enough to ensure the lender that you are able enough to repay the borrowed amount on time.

A typical minimum down payment is about 15% to 20% or even 25% in some cases.  By making a large sum of down payment, you can also ensure the lender that you are loyal enough with the move you are making and you would surely repay the borrowed amount back to the lender on time as well.

So, I am sure that by now you must have gotten an idea what high risk mortgages really are and who is applicable to go for this type of mortgage as well. So, if you are having some financial crunch and at the same time you carry a low credit score then don’t worry, you can easily make use of the option to overcome you financial woes and worries in a feasible manner.  Most high risk loans are short term i.e. from 1 to 3 years.  This gives the borrowers time to repair their credit score and be able to obtain a mortgages from a lower risk lender when their mortgages comes up for renewal.