Can I Get a Mortgage With Bad Credit?
Washington & Sunderland Specialist Mortgage Advice
If you’ve had credit problems in the past, you might assume getting a mortgage is impossible.
We speak to buyers across Sunderland and Washington every week who say:
“I don’t think I’ll be accepted.”
“My credit score isn’t great.”
“I’ve had a default/CCJ - so I can’t get a mortgage, right?”
But the truth is that bad credit does not automatically mean you can’t get a mortgage. It just means you need the right advice, and the right lender. At Fairway Mortgage Advice, we specialise in complex and adverse credit mortgages. Here’s what you need to know.
What Counts as “Bad Credit”?
Having bad credit can include:
Missed payments
Defaults
CCJs (County Court Judgments)
Debt management plans
IVAs
Payday loans
High credit utilisation
Low credit score
However, not all credit issues are treated the same by lenders. For examples, a missed payment from three years ago is very different from multiple recent defaults.
Can You Still Get a Mortgage?
In many cases - yes, you can!
There are many lenders who specialise in adverse credit cases, and we work with these lenders often! However, your options may depend on:
How recent the issue was
How severe the issue was
Whether it has been satisfied
Your current financial stability
Your deposit size
For example, the larger your deposit, the more options you may have. If it’s been satisfied, the more options you’ll have. It’s not necessarily black or white.
How Much Deposit Do You Need With Bad Credit?
While some buyers with clean credit can purchase with 5% deposit, this is not necessarily the case if you’ve got bad credit. Adverse credit cases may require:
10% deposit
15% deposit
Or sometimes more, depending on the situation, as every lender’s criteria is different. This is why applying directly without advice can sometimes lead to unnecessary declines, which can damage your credit profile further.
Will You Pay Higher Interest Rates?
Possibly, but not always as high as people fear! Rates depend on:
The severity of your credit history
How long ago issues occurred
Your overall profile
Current market conditions
Some buyers are surprised to find their rate is actually far more competitive than expected! Our aim at Fairway Mortgage Advice is to always get you the best possible rate, regardless of your financial situation.
Should You Apply Directly to a Bank?
This is where many buyers go wrong. We’d always advise not to go directly to the lender, as high street lenders often have stricter criteria, and if you’re declined, that hard credit search remains on your file.
A specialist broker like ourselves can:
Assess your situation first
Identify lenders most likely to accept you
Protect your credit file from unnecessary searches
This is especially important if you’ve already had financial difficulties, you really don’t want to be risking any more hits to your credit score.
What Can You Do to Improve Your Chances?
If you’re planning ahead, some excellent things you can do to improve your chances are:
Register on the electoral roll
Reduce outstanding credit balances
Avoid taking new finance
Ensure bills are paid on time
Check your credit report for errors
Even small improvements like these can make a massive difference to your options
Every adverse credit case is different. Two buyers with similar incomes could have completely different outcomes depending on:
The type of credit issue
How recent it was
Their deposit
Their current stability
At Fairway Mortgage Advice, we specialise in finding solutions for buyers who may have been declined elsewhere. If you’re unsure whether you qualify, it’s better to get clarity than assume the worst.
👉🏻 Get in touch today to explore your mortgage options. 🫶🏻🏠
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We are a whole of market broker. Contact us today to discuss your options!
📳07442869863
📞0191 466 1304
📩info@fairwaymortgageadvice.co.uk
🖥️www.fairwaymortgageadvice.co.uk
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Your home may be repossessed if you do not keep up with the repayments on your mortgage. Not all buy to let mortgages are regulated by the financial conduct authority. You may have to pay an early repayment charge to your existing lender if you remortgage.