A Remortgage Before And Since The Credit Crunch

Remortgages are financial products that are only available to homeowners , and for which tenants, ie. those who only rent their homes, are not eligible.

The reason for this is that a remortgage replaces an already existing mortgage and as a mortgage is the home loan used to buy a house it is obvious that only homeowners can apply for remortgages.

Remortgages just like mortgages are secured on property,and naturally this property must be owner occupied.

As a direct result of remortgages are secured the mortgage lender is confident that the person applying for the remortgage is secure in his mind that he can comfortably afford the repayments all leads to remortgages being more readily obtainable than unsecured loans.

Unfortunately due to the the credit crunch and many losing their jobs as a result of it many people have fallen behind from anything from one month to very serious arrears with their mortgage payments.

Such wide spread mortgage arrears is not the norm as most people are very careful about maintaining their mortgage payments as their home is the most important thing in the world to them.

The fact that many mortgage payers have fallen behind in their repayments although many through no fault of their own has lead mortgage lenders tighten up on the granting of remortgages.

Changes such as the abolition of self certifications of income have been introduced and proof of income is required for both employed and self employed remortgage applicants.

In the past it was possible for a self employed applicant to write his earnings on a bill head without providing any additional back up proof, and human nature often being some what dishonest, the earnings declared were often very much higher than what they in reality were.

Other changes because of what has happened in the mortgage and remortgage market is that mortgage lenders now insist on seeing the last three months bank statements to make certain that the applicants outgoings, earnings etc. are exactly as stated on their remortgage application.

This tightening up should make the possibility of so many people in arrears happening in the future less likely.

Living through another recession is not an option.

The better underwriting should make certain of this.