The other day, in Britons struggling with debt repayments, I said there might be a chink of light amid all the financial gloom.

But I spoke too soon as far as anyone with a troubled credit history is concerned.

The recent global stock market falls were sparked by US lenders getting in a mess over what are known as “sub-prime” or impaired credit loans.

Basically, they lent too much money to too many people who, it turned out, weren’t able to pay it back.

Now, here in the UK, lenders are getting the jitters about these mortgages.

Northern Rock has priced itself out of this sector of the market by raising interest rates by up to 1.25 per cent and ditching base rate tracker loans for borrowers with poor credit records.

Specialist impaired credit mortgage lender GMAC-RFC has also lifted its rates, and it looks as if other sub-prime lenders will follow their example.

This doesn’t mean you won’t be able to get a mortgage if you have a chequered financial history, but it does mean it’s going to be harder to find a good deal.

Because of this, it’s more important than ever to shop around – and to borrow responsibly.

If you’ve had credit problems in the past, it’s crucial not to over-extend yourself.

Stick with a debt you can comfortably afford…

Be financially disciplined so you can keep up the repayments…

And hopefully, before long, your troubles will be a thing of the past.

This entry was posted on Saturday, August 25th, 2007 at 11:00 pm and is filed under UK Mortgages, UK Personal Finance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.