Perhaps unsurprisingly, if you have a bad credit history you will find it harder to get a mortgage on competitive terms.

The reasons are obvious. Mortgage lenders are prepared to accept a lower return on their money if they are lending to a ‘good bet’. Someone that’s borrowed money before or has kept to previous financial commitments such as home electricity bills, mobile phone contracts, etc.

Every time you make a late payment on these things it can count against your credit score. If you are taken to court for non-payment and a County Court Judgment (CCJ) is made against you then that too will damage your credit score.

But it’s not just poor money management that can come back to haunt you. Gaps in the electoral roll (perhaps when you were working abroad or living with family) can adversely affect your credit score as can your age, employment history and other aspects of your life that might seem to have little to do with obtaining a mortgage. Even regularly applying for credit can have an effect on your credit score.

The good news is that even with a bad credit score (perhaps you’ve previously had an IVA or DMP) it is still possible to obtain a mortgage. Unfortunately, because of the perceived extra risk, you may find that you have to put down a larger deposit than might otherwise have been required. It’s also likely that a lender will want to charge you a higher rate of interest to make up for the added risk of you failing to keep up your repayments.

Every mortgage lender has their own credit scoring system which is not published, so finding out your credit score online may not necessarily help. But if you feel you may have bad credit, you should obtain a copy of your credit report which will show all your credit, good and bad. You can get this for free online from companies such as Experian or Equifax.

It’s important that when you apply for a mortgage, you apply to lenders that are likely to meet your borrowing criteria and also who are likely to accept you as a borrower. For example, some lenders don’t cater to the self-employed. Others specialise in this field.

The bad news here is that each time you apply for credit and/or have it refused, you are damaging your credit score! The good news is that here at Mortgage Required, our specialist poor credit mortgage advisers can quickly select the best lender for your needs and enhance your chances of receiving a mortgage offer that will suit your circumstances.

Related articles:

Recent posts

The average age of a first-time buyer in the UK is two years older than 10 years ago. This is understandable with managing the cost-of-living and challenges within the economy such as high interest rates making it difficult to get onto the property ladder.

Skipton Building Society launches ‘Delayed Start’ mortgage meaning first time buyers won’t be required to make repayments for the first three months. 

According to a survey by Skipton, first time buyers who bought their home in the last five years found that in the first three months of living there, they were spending upwards of £30,000.

If you have recently moved into a property with a garden that requires a little TLC, or you’d like to get on top of your current green space, check out our tips.

High street lender, NatWest, have launched a new product to help first-time buyers purchase a property with assistance from a family member or friend to get them on the property ladder sooner.

‘Buy Now, Pay Later’ (BNPL) schemes, such as ‘Klarna’ are short-term loans that allow shoppers to make a purchase, but delay paying for it for an agreed amount of time.

Klarna is one of the most popular BNPL services with 18 million customers in the UK alone, and offers interest-free payment options which is appealing to shoppers. However, does it affect a mortgage application?

We look at how to get the best Buy to Let mortgage rate, what's in store going forward, and options as a landlord with increasing costs.

Throughout this past week, lenders have continued to reduce their mortgage rates giving borrowers in the UK some welcome news following the change in global tariffs under US President, Donald Trump.

Did you know that buying a house, or relocating is in the top 10 most stressful life events?

Stress of course is an unavoidable part of life and there are many reasons why people experience stress, not just buying a house!

There are lots of effective ways to manage and reduce stress, check out our tips to help you.