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Enhancing criteria on our Credit Flex product range

We have updated the criteria on our Credit Flex mortgage product, with changes effective from today (June 18).

TLDR

We’ve enhanced criteria on our Credit Flex mortgage product, designed for borrowers with an adverse credit history. The criteria updates are in the following areas – Credit Card, Current Account, Utility Payments, Payday loans, Mortgage payments, CCJ, Debt Management Plans, Defaults, Hire Purchase, Secured/Unsecured Loans, IVA, Debt Relief Order, Bankruptcy, etc.

Explore all the full criteria update below and if you have any questions, please get in touch with our team.

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What is Credit Flex?

This flexible mortgage product is designed to meet the needs of a range of borrowers with an adverse credit history. This includes borrowers with CCJs, debt management plans, IVAs, payday loans as well as those who have missed payments on utility bills, credit cards, mortgages or secured loans.

Enhanced Criteria

The new criteria simplifies underwriting requirements, and in many cases extends criteria to cover a wider range of borrowers. Examples of enhanced criteria include:

  • Credit Card, Current Account, Utility Payments: Previously accepted borrowers who were up to three months late with payments over the previous 12 month period. New criteria will accept borrowers whose payments are up to five months late over this time frame.
  • Payday loans: Previously we would not lend to borrowers who had taken out a payday loan in the previous 12 months, this has now been reduced to a six month period.
  • Mortgage payments: We will now consider borrowers who were up to two months late with repayments over the previous two years. Previously this was restricted payments that were only one month late, again over a two-year period.
  • CCJ: Previously one CCJ was allowed in the prior two-year period, up to the value of £250. New criteria extends this to two CCJs over a three-year period, with a total value of £500.

A full list of criteria changes is included in the table below. The criteria updates reflect ongoing challenges in the market and have been made in response to feedback from brokers.

Christopher Holmes our Senior Product and Proposition Manager commented:

“We want to make the broker’s path to application as smooth as possible by cementing the challenges we most commonly see into our published lending criteria. In a fast-changing market this will mean more brokers getting faster decisions for their clients.

“At H&R we know a one-size-fits all approach to lending fails to meet the needs of many homeowners today. Most lenders want an applicant’s circumstances to fit one of their mortgages — but our range of Flex products are designed to be adaptable to meet the client’s needs.

“The Credit Flex mortgage offers an affordable, flexible solution to those with previous credit problems, who are often rejected by mainstream lenders. The enhanced criteria means that more borrowers will be able to access this product and benefit from the Society’s competitive rates and high service standards.”

Table of Criteria changes

Lending areaPrevious lending criteriaNew criteria
CCJ– None within last 3
months.
– 1 in last 24 months
up to max £250.
– 2 over 24 Months up
to max £500.
– None within last 3 months.
– Maximum 2 allowed between 3 – 36 months up to a total value of £500.
Communication– Any number of late payments (including settled default).– Any number of late payments (including settled default).
Credit Card, Mail Order,
Current Account, Utilities
– Up to 3 months late
within 0 – 12 months.
– Up to 4 months late
within 12 – 24 months.
– Up to 5 months late
within 24 – 36 months.
– Any number of late
payments 36+ months
ago.
– Up to 5 months late payments within the last 24 months.
– Over 24 months any number of late payments considered.
Debt Management Plans– None registered within 24 months and must be
satisfied & discharged prior to completion.
– None registered within the last 12 months satisfied & discharged prior to completion. If unsatisfied must have
satisfactory conducted for
24 months & refer to MRC.
Defaults – Utilities, Credit
Cards, Telecoms
– None within the last 3
months.
– Maximum of 1 – 3 – 12
months ago up to £250.
– Maximum total amount of £500 12 – 24 months.
– Maximum total amount of £1,000 24 – 36 months.
– Maximum total amount of £2,500 36+ Months.
– None within the last 3
months.
– Maximum total value £2,500 last 36 months.
– Above £2,500 refer to Level 4 mandate holder.
Hire Purchase Or
Unsecured Loan
– Up to 2 months late within 0 – 36 months.
– Up to 3 months over 36 months.
– Up to 2 months late payments within the last 24 months.
– Up to 3 months late 24 – 36 Months.
IVA, Debt Relief Order,
Bankruptcy
– None within the last 5 Years. Any historical must be satisfied.– None within the last 3 years. Any historical must be satisfied.
Mortgage Or Secured
Loan
– Up to 1 months late
payment within 0 – 24
Months.
– Up to 2 months late within 24 – 36 Months.
– Up to 3 months late over 36 months.
– Up to 2 months late payments within the last 24 months.
– Up to 3 months late within 24 – 36 months.
Pay Day Loans– None within the last 12 months.
– Maximum of 1 up to
£250 within 12 – 24 months.
– Maximum of 2 up to £500 within 24 – 36 months.
– Maximum of 3 up to £750 within 36+ months.
– None within the last six months.
– The maximum total value of £500 within last 36 Months.

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Speak to us

Our dedicated Business Development team will be happy to speak to you about any cases you have, explain how our specialist products and flexible criteria can benefit your clients, or answer any questions you have about our Mortgage Referrals Committee. Get in touch on 01455 894 084. Or send us a message on our Live Chat, our response time is often only seconds!

Please note product details and criteria are correct at launch and are subject to change.