Adverse credit mortgages (also known as sub prime or non-conforming mortgages)

What is a 'non-conforming', 'sub-prime' or 'adverse credit' mortgage?

These are mortgages specifically designed for people who do not qualify for a mainstream mortgage from lenders. They may be suitable in a variety of situations; for example, if you have had credit problems in the past or have difficulty proving a regular or reliable income.

Such situations are unfortunately increasingly common. Life changing events such as divorce, unemployment and sickness can sometimes cause you to miss making payments on your mortgage or other financial commitments. These things happen to many people at some stage in their lives, but once such problems are behind you, they should not stop you applying for a mortgage. 

We have produced a consumer leaflet which is designed to give you information on adverse credit mortgages, and gives answers to some common questions. 

In November 2006 we produced an article looking at adverse credit mortgage lending - that is, lending to borrowers who have experienced material and recent credit difficulties. Until the recent credit crunch adverse credit lending was a rapidly growing part of the UK mortgage market. Industry estimates suggest that adverse credit lending represents the largest specialist sector after buy-to-let, accounting for perhaps 5-6% of total industry gross advances in 2007. There are very few products available on the market today.

The CML works with members to understand this sector of the market better and improve the information available.