Rougher seas for adverse credit

“There is no question that the current climate is tough for those who don’t fit the criteria for standard mortgages,” said Moneynet's chief executive, Richard Brown.

“There are deals to be had but the rates can be extremely high, as much as 9.99 per cent fixed until November 2009 from Alliance & Leicester in order to offset the allowances made for unlimited CCJs, unlimited mortgage arrears and a blind eye turned to defaults on credit card payments.”

This might seem affordable for some, but it is nearly twice the best fixed rate offers on the market for the most credit-worthy borrowers.

“These products should only be used to help people stabilise and restore their credit rating, not for continuing to finance an otherwise unsustainable lifestyle."

Chelsea Building Society is offering a more favourable rate of 5.69 per cent but at only 75 per cent LTV, a hefty 2.5 per cent fee and stricter rules of acceptance.

An alternative is two products from BM Solutions which carry higher rates but will go to 90 per cent LTV.