Your cookie preferences

We use cookies and similar technologies. You can use the settings below to accept all cookies (which we recommend to give you the best experience) or to enable specific categories of cookies as explained below. Find out more by reading our Cookie Policy.

Select cookie preferences

Skip to main content

Bad credit mortgages

If you have bad credit, getting a mortgage can be difficult. But don't worry, our broker partner Advantage can help find the most suitable bad credit deal for you.

Lady working at a desk at home

Can I get a mortgage with bad credit?

In some cases, yes you can. However, it depends - as well as a difference in what each lender considers to be 'bad credit', the severity of your credit issues impact the likelihood of being approved.

If you're concerned about mortgage approval due to your credit history, there are a number of bad credit lenders who are more flexible with their criteria. Mortgage rates for bad credit mortgages tend to be higher, but it's certainly an option for those looking to get a mortgage sooner rather than later.

What issues can impact my credit?

Bad credit is a blanket term used to describe a wide variety of personal finance issues that are recorded on your credit file. They could range from having a single late payment, right through to bankruptcy.

All of the following circumstances would fall under the umbrella of having bad credit and are loosely in order of severity:

  • No credit score due to never having used credit

  • Missed or late payments

  • Defaulted payments

  • County Court Judgement (CCJ)

  • Debt Management Plan (DMP) or Individual Voluntary Arrangement (IVA)

  • Mortgage arrears

  • Bankruptcy and repossession

If you have bad credit, getting a mortgage can be more difficult, but bad credit lenders or 'subprime lenders' as they're often referred to, can usually accept credit issues at the more severe end of the scale.

That said, if you're looking to get a bad credit mortgage after bankruptcy or repossession, your options will be quite limited.

What minimum credit score do I need to get a mortgage? 

There is no minimum credit score that applies universally across the mortgage industry! Each lender has their own idea of what constitutes bad credit, and not all lenders use the same referencing agencies

Usually when you have bad credit, you'll have a low score on your credit report. However, each of the three major credit referencing agencies, Experian, Equifax and TransUnion, use a different scoring system. So a very low score with one agency, may not be so bad with another, or vice versa. 

This means that your credit score in relation to the actual number is not something to fixate on, as most mortgage lenders use it alongside your broader credit history to make a more holistic decision. 

The good news is, this means that being rejected by one provider does not necessarily mean that you would be by the next. A broker who specialises in bad credit mortgages should be able to help you find a lender to suit your needs.

How does bad credit affect a mortgage?

The main difference is that interest rates for bad credit mortgages are usually higher. You may also have to pay higher arrangement fees when you take out a mortgage. Be sure to consider the total cost when you compare bad credit mortgages - including fees.

The type of bad credit you have can also impact how it affects your mortgage application. For example, depending on the lenders' indiviudal criteria, the following may change how a lender sees your circumstances:

  • How long ago the credit issues occurred - some lenders will disregard older issues

  • Whether or not they're resolved - some lenders prefer that debts are satisfied (repaid)

  • How severe the type of credit issue is - missing a phone bill payment won't be seen in the same light as having a house repossessed, for example

  • Whether your issue is with secured debt - unsecured debt issues are often considered less important than secured debt issues (where the loan is secured against collateral, such as a property or car)

  • How much your debt is - Many lenders are willing to consider debts under £1000, but grow concerned when a default or CCJ relates to a higher amount

How to increase your chances of buying a house with bad credit

When you're looking to take out a mortgage with bad credit, the key a successful result is preparation. To maximise your mortgability, you should:

Use an experienced broker

Whole-of-market mortgage brokers like our partners at Mojo Mortgages have access to every bad credit lender on the market, including some that may not be accessible to the general public.

Using a broker can increase the number of lenders available, meaning there's more chance of finding a lender with criteria that matches your circumstances.

Brokers can also steer you away from applications that would be likely to fail - which can prevent further damage to your credit file.

Increase your deposit

Offering a bigger deposit will give you access to better rates, whatever your circumstances. It gives lenders more confidence in your commitment to the loan as they see you as less risky.

As mortgage rates for bad credit applicants tend to be higher, this can go a long way to repairing concerns that the lender has, and potentially result in a slightly lower rate.  

It’s unlikely you'll get a 95% mortgage, as typically bad credit mortgage lenders require at least 15% deposit (85% LTV). Offering more than 15% will increase your chances of finding a suitable mortgage.

Check your credit file

It’s important to go into your mortgage application with a good understanding of your finances, so make sure you obtain a copy of your credit file from TransUnion, Equifax and Experian to see what information is held about you.

Your credit file can also contain incorrect information. Even the smallest mistakes can impact your score, so check that all names, addresses, and particularly information about past credit issues, are correct.

You can approach the credit reference agencies to amend mistakes if you find any - this can take a few weeks, so it’s best to do this early.

Improve your credit score

Your credit file shows your management of past and present debts, including how much you owe, how much you've paid back and whether you've missed any repayments. The score builds slowly over time and negative occurrences, such as CCJs, stay on your file for six years. 

There are a few quick ways to improve your score:

  • Try to your best to resolve any issues as some lenders will prefer a default or CCJ to be satisfied (paid off)

  • Make sure you're on the electoral roll at your current address and cancel accounts that are no longer used, such as old bank accounts or credit cards

  • If you've never used any form of credit, lenders will see this as less severe than bad credit. However, credit builder credit cards can help increase your score more quickly

  • If you're renting while you save for a deposit, companies like CreditLadder - who record your rental payments on your credit file on your behalf - can help you to develop a picture of financial responsibility

Apply for an agreement in principle

Applying for a mortgage agreement in principle, prior to your full application, will help you to gauge the likelihood of being accepted, without damaging your credit file.

Typically only soft searches are carried out at this stage - which have no impact on your credit file. Your broker or lender will confirm whether a soft or hard search will be carried out if you're concerned, however.

Multiple hard searches can affect your credit score, so this is a good way not to affect your chances of acceptance any further, if you already have bad credit.

Use a guarantor mortgage or other financial help from family

Guarantor mortgages can be helpful if your credit score is preventing you from getting a mortgage, or you're unable to meet mortgage affordability criteria due to a low income. 

Having a guarantor does not always mean your application will be accepted, but it should improve your chances.

Most lenders will also accept a 'gifted deposit' from a family member, which can help those struggling to save one. This can't be a loan and you must be under no obligation to repay the money.

It’s also become more common for people to buy jointly with family. Some lenders allow you to include up to four borrowers on one mortgage - maybe something to consider if you have a close group of siblings. 

How to apply for a mortgage with bad credit

If you have a bad credit record, your mortgage options are likely to be more limited and less competitive than those available to people with better credit scores.

Some lenders are more sympathetic to certain reasons behind bad credit than others. For example, being in debt because your partner passed away and you've struggled to live on a single income will be seen in a better light than being in debt due to irresponsible spending habits.

Mortgage lenders conduct credit checks on all potential borrowers, so there’s no point in trying to hide your credit problems. In fact, being dishonest about your credit history is more likely to reduce your chance of being accepted! 

How long might I have to wait if I'm declined?

If you’ve got a history of defaults or CCJs, mainstream lenders may begin to consider your application around six to 12 months after they've been resolved. With more severe issues, such as bankruptcy, most lenders will expect them to have been discharged for around six years before you're accepted.

Subprime lenders are usually able to help out sooner if your credit issues are at the more severe end of the spectrum. A mortgage broker can to help you work out how long you may have to wait until you're likely to be accepted for a mortgage, if you wouldn't currently be.

Advantages of getting a mortgage with bad credit

  • You can buy a home now, rather than waiting

  • You can lock in today’s prices, both in terms of property cost and interest rates, which may go up in the future

  • You can put money wasted on renting accommodation to better use

Disadvantages of getting a mortgage with bad credit

  • Higher interest rates

  • A larger deposit is needed

  • You might be offered a lower LTV (loan to value) on your borrowing

  • You will have less choice of lenders

Kellie Steedquotation mark
Your credit history plays an important role in your chances of getting approved for a mortgage. You may need to pay higher rates if you have poor credit - speaking to an expert can help you find a deal that's right for you
Kellie Steed, Mortgage Content Writer

Bad credit mortgages FAQs


Uswitch is not a mortgage intermediary and makes introductions to Mojo Mortgages to provide mortgage solutions. Uswitch and Mojo Mortgages are part of the same group of companies. Uswitch Limited is authorised and regulated by the Financial Conduct Authority (FCA) under firm reference number 312850. You can check this on the Financial Services Register by visiting the FCA website. Uswitch Limited is registered in England and Wales (Company No 03612689) The Cooperage, 5 Copper Row, London SE1 2LH. Mojo Mortgages is a trading style of Life's Great Limited which is registered in England and Wales (06246376). Mojo are authorised and regulated by the Financial Conduct Authority and are on the Financial Services Register (478215) Mojo’s registered office is The Cooperage, 5 Copper Row, London, SE1 2LH, and head office is WeWork No. 1 Spinningfields, Quay Street, Manchester, M3 3JE. To contact Mojo by phone, please call 0333 123 0012.