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Mortgage Advisor & Director
Can I get a mortgage with a low credit score?
While there is no specific credit score that will guarantee you will be approved for a mortgage, it is fair to say that having a higher score helps you to access the best deals.
If you have had credit issues in the past or present, don't despair. There are lenders who specialise in mortgages for people with a low credit score. A bad credit mortgage is a mortgage designed for applicants with a poor credit history or low credit score. There are many reasons for having a poor credit history, ranging from a few missed payments to CCJs and IVAs. You may have a low credit score simply because you haven't used credit or have lived abroad.
What is the difference between a bad credit mortgage and a standard mortgage?
There are a few differences between a bad credit mortgage and a standard mortgage:
You are likely to need a lender who specialises in low credit score mortgages, rather than a high street lender. If your mortgage application is refused, this will further reduce your credit rating, so you must make the right application to the right lender - an experienced broker can help with this.
The rates you can expect to get will not be as competitive. The lender will attempt to mitigate against your elevated risk as a borrower by increasing the interest rates on your mortgage.
Your lender may also offer a lower Loan to Value (LTV) to mitigate against the increased risk, which means you will need more of a deposit to put forward or enough equity in your home to account for this.
How can I get a mortgage with a low credit score?
The good news is that there are specialist lenders who will consider your mortgage application. They will look at a range of factors:
The age and severity of the credit issue - a few missed payments will not be judged as harshly as an IVA or bankruptcy, for example, and the longer ago the issue was, the better. If you can take steps to improve your credit rating, such as using credit sensibly and making repayments on time, this will help to demonstrate you are a credible borrower.
Your salary will have more of an impact when applying for a poor credit mortgage. Lenders will be interested to know that you can afford the monthly repayments, and with a poor credit history, your salary makes more of a difference.
What credit issues will be accepted?
Minor issues on your credit record, such as late or missed payments do not have the same impact as more severe problems such as repossessions and bankruptcies.
In comparison to high-street lenders, specialist providers can offer a solution to applicants with a range of credit issues, including:
- Adverse Credit
- Bad Credit
- Bankruptcy
- CCJs
- Debt Consolidation
- Debt Management Plan
- Debt Management Schemes
- Debt Relief Order
- Default
- IVAs
- Late Payments
- Low Credit Score
- Missed Mortgage Payments
- Mortgage Arrears
- No Credit History
- Payday Loans
- Poor Credit
- Repossession
How can I learn more?
Our team of experts have helped many people with a low credit score to get the best possible deal on their mortgage. We work with more than 100 lenders to find you the perfect mortgage. We appreciate that for people with financial problems, current or historical, applying for a mortgage can be a difficult time. We promise to make your mortgage journey as stress-free and straightforward as possible. Complete our simple online form to get started.
Choosing an Adviser
Selecting a qualified and experienced mortgage adviser is of great importance. To choose a suitable adviser, evaluate their qualifications, experience, and reputation, and ensure they are regulated by the Financial Conduct Authority (FCA).
Read reviews from previous clients and make sure they provide a clear explanation of the products and services they offer, as well as the fees and charges associated with them.
