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Money Planning 101Getting Accepted For A Mortgage With Bad Credit History
The, current credit squeeze is affecting many mortgage borrowers, in particular, those with poor credit. Borrowers who have poor credit can still obtain a mortgage, using a company that offers 'bad credit mortgages' as a way out of debt.
Just the expression bad credit can send people running, but there is no reason for this. In the current economic climate it is very easy for anyone to fall into the bad credit debt trap.
But even in these difficult times there are still options for people with adverse credit. It is possible you may have to pay a slightly higher fee, and the broker may have to work harder for his money. But you should be able to work around any problems, to help get you a mortgage and resolve your debt situation.
To get the best results when looking for a bad credit mortgage, it is definitely advisable to engage the services of a specialist broker, as he will almost certainly get the best results for you.
This is because the specialist brokers know who to contact to make an application for a bad credit mortgage. It is essential that you are honest with the broker right from the start; if you mislead him it can only cause problems down the line. He will know how best to present your case and application to the suitable lender.
There is no reason to assume that a decent broker will not be able to help you resolve your bad debt mortgage problems and help you set your credit on the right path again.
Control your spending once you have the mortgage
Now you have a bad debt mortgage it is the best policy to try to avoid getting back into debt and repair you credit history at the same time.
Most people's wages seem to disappear without trace, you can cover the basics of may fall down as the money starts to run out at the end of the month.
The best way to deal with this problem is to set yourself a budget; most people go their entire lives without living to a set budget. But if you have had debt problems this is easily the best way to avoid it happening again.
It can be pretty scary, to set yourself limits on your spending, rather than just spending money 'as you need to'. The first and simplest thing you need to do is make a plan, you need to know exactly how much you bring home in cash every week every month.
Next you need to list all your expenses, generally all the things you can't get away from such as water and electricity, gas, transport and so on. Add those of the see how much they are in total. If you're not sure, go for the highest figure you think it is.
The next thing to do is put all your other expenses into categories. This will depend how you live your life, but basically, if you eat or drink out a lot. You could put the in a luxury category.
Then, things like food and other living expenses would be categorised as necessities. You need to be realistic, with all these estimates and make sure as far as possible it is what you actually spend each month.
Now, once you have worked out more or less what you are spending in total for absolutely everything. You can figure out how to cut down on these expenses, first, consider those essentials electricity, gas and water could you save a little money on those by cutting back a little. Perhaps switching the heating half an hour before you go to bed, rather than when you go to bed.
Could you take one more shower and one less bath each per week, how about making sure that you have all your groceries in one weekly shop. Rather than making several short trips in the car each week to the local shop to pick up 'bits and pieces'. This will save on petrol, and the cost of the things you buy.
Next consider cutting down on some of those luxuries. Instead of eating out once a week, making once a fortnight, instead of going to a drink twice a week, make it once a week. These things will add up considerable savings over the course of a month.
One last tip to help you avoid the debt trap again is to write down everything you spend, every penny. Doing this will make it very clear in your mind, just how much you are spending on individual items. Over a few months you will learn that a pound here and the pound there can definitely add up to a considerable amount of money and plunge you back into debt again.