Mortgages for borrowers with bad credit history

Matt Gilmour, managing director of Magellan, said borrowers who had experienced a “one-off life event” affecting their credit record could have their application considered, as long as they can explain and document the reasons for their financial difficulties.

Borrowers will also be required to demonstrate they have had a clean credit history for the previous 12-month period.

Magellan is offering a range of five products, available to the employed, self-employed and first-time buyers, with a minimum income of £25,000.

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Applicants can borrow for purchase or remortgage up to a maximum loan of £400,000. The maximum loan-to-value is 75 per cent and all products are priced at 8.55 per cent.

Adviser view

Tony Salentino, director of Hampshire-based advisory firm Complete FS, said: “New lenders are more of a rarity these days so we welcome Magellan to the market. With a clear strategy of targeting those clients who have suffered a devastating one-off event, which has compromised their credit rating but can explain the reasons and demonstrate they have their affairs back in order, Magellan is to be congratulated for filling a big gap in the market.”