Specialist adverse credit lender Platform Home Loans has brought in the fixed rate mortgage.
Platform is aiming the mortgage at borrowers who have had trouble obtaining mortgages in the past because of a history of adverse credit or because of county court judgements (CCJs) made against them.
The mortgage has a fixed rate of 7.49 per cent until July 1, 2002 for loans of up to 95 per cent of valuation. After the fixed rate period the mortgage reverts to 3.75 per cent above the London Interbank Offered Rate (LIBOR).
The mortgage has an arrangement fee of £395 and redemption penalties of 6 per cent of the advance in the first two years and 5 per cent in the third year. Customers are allowed up to £3,000 in CCJs against them, but no CCJs in the past 12 months.
According to analysts Datamonitor this market is growing. In 1999 adverse credit lending totalled £5.9bn, up from the previous year's total of £4.98bn.
Looking at the adverse credit lending market, Moneyfacts indicates the most competitive one-year fixed rate adverse credit mortgage on May 31, 2001, is from Bristol & West. This is the one-year adverse credit mortgage, which has a fixed rate of 5.25 per cent for the first year. It has a CCJ limit of up to £10,000, which is higher than Platform Home Loans. It also has more competitive redemption penalties of five per cent of the advance for the first two years and four per cent for the third year.