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Getting a Mortgage with Bad credit

Can I get a mortgage with a bad credit rating?

Yes, you can – poor credit mortgages are available for purchase or remortgage.

  • Mobile phones – missed payments, defaults, CCJ’s – IGNORED by our bad credit mortgage lenders
  • Mail order – missed payments, defaults, CCJ’s – IGNORED by our bad credit mortgage lenders
  • Utility bills – missed payments, defaults, CCJ’s – IGNORED by our bad credit mortgage lenders

Debts on mobile phones, mail order, and utility bills are all ignored by our poor credit mortgage lenders up to £500

Getting a mortgage if you have Defaults

  • Defaults +6 months ago – bad credit mortgages available with 20% deposit
  • Defaults +12 months ago – bad credit mortgages available with 15% deposit
  • Defaults +24 months ago – bad credit mortgages available with 10% deposit

Do you have a poor Credit Rating due to County Court Judgements?

  • CCJs +6 months ago – bad credit mortgages available with 20% deposit
  • CCJs +12 months ago – bad credit mortgages available with 15% deposit
  • CCJs +24 months ago – bad credit mortgages available with 10% deposit

Is your poor Credit Rating Missed Mortgage Payments?

  • Missed mortgage payments +6 months ago – bad credit mortgages available with 20% deposit
  • Missed mortgage payments +12 months ago – bad credit mortgages available with 10% deposit

Mortgage payments must be currently up-to-date

Are you in a Debt Management Plan?

  • DMP satisfactorily conducted for 12 months – bad credit mortgages available with 10% deposit


  • Bankruptcy or IVA discharged >3 years – bad credit mortgages available with 20% deposit
  • Bankruptcy or IVA discharged >6 years – bad credit mortgages available with 15% deposit

Help to Buy Mortgage Lending with Poor Credit

Help to Buy bad credit mortgage lending is available with a 5% deposit.

If you need a Bad Credit Mortgage for a Help to Buy Equity purchase, please visit our specialist Help to Buy scheme page.

How much will I pay for a bad credit mortgage?

Bad credit mortgage rates are available from under 2.5%

On average expect to pay between £450 and £600 per month per £100,000 borrowed*

(*25-year term – each case is assessed individually)

How long does getting a mortgage with bad credit take?

Our team can obtain a ‘yes’ from a suitable lender for you within 36 hours

Valuation of the property and full application to formal offer takes around four weeks on average

How much are your fees?

We ask for £99 to obtain your ‘yes’ from a suitable bad credit lender.

Our total fees will not exceed £797.

You should call us without charge or obligation to establish if we can assist you.

Our full terms are available here.

What if my credit rating and history are really bad?

If you have a history of mortgage arrears, Debt Management Plans, Bankruptcy, or multiple Defaults or County Court Judgements, there will still be some options for you.

You will need a larger deposit the more bad credit and the more recent the bad credit you have on your credit file.

I need to raise more cash from my home

If you need to remortgage to raise extra cash but have a low-cost mortgage that you do not want to lose, we can help.

We can raise extra funds for you whilst leaving your current deal untouched.

I’ve been told ‘no’ elsewhere

Many lenders are not interested in helping applicants who have bad credit.

And many brokers have little experience and knowledge of getting a mortgage with bad credit.

At A Mortgage Now we arrange bad credit mortgages for customers every day.

What if I don’t know how bad my credit history is?

You need to obtain a copy of your credit report from each of the three main credit reference agencies.

Each report is available online at a cost of £2.

You can find details on how to obtain and read your credit reports here.

Explanations of credit terms

About your credit file

Your credit file carries six years of your credit history and is the primary tool used by a Mortgage Lender to make a decision on whether you are a good lending risk. If you are not sure what your credit file contains, you can obtain a copy from companies such as Experian or Equifax. More details about your credit file and how it works are set out below at the bottom of this page.

Bad Credit Mortgages and Missed Credit Payments

Have you missed payments or made late payments on credit?

If you have, this may show on your credit record. A credit file is held on you by companies such as Equifax or Experian, and each time you take or repay credit, that information is logged on your file by the credit provider.

Your credit file contains details of when you applied for credit and to whom – how much you have borrowed – from whom, and what the regular repayments are.

Most importantly, from a prospective lender’s point of view, your credit file shows details of when payments were made and when they were missed.

A missed credit payment, although a flag to a mortgage lender as ‘bad credit’ will not stop you from getting a mortgage.

Top tips to avoid missed credit payments showing on your credit file:

1. Use Direct Debit Mandates where possible.

2. Make your payments early in the month so that if there is a problem you can make the payment up in the same month before your lender registers a missed payment on your credit file.

3. In our experience, the most common cause of late or missed payments is mobile phone bills. To avoid this risk, use pay-as-you-go contracts.

Bad Credit Mortgages and Defaults

A default is a formal notification from your Creditor that payments are not being paid on time. You will not automatically get a default if you miss a payment on your credit as they are usually issued when you are in arrears by three to six months.

Your default notice will outline all relevant information on the debt and why you are in default.

Default notices should not be ignored as they are the first sign that legal steps may be taken to recover your debt. They are therefore the stage before a CCJ.

Bad Credit Mortgages and County Court Judgements

Do you have, or have you had, a County Court Judgement against you?
You are not alone. Around two thousand County Court Judgements (CCJs) are issued every day.

A County Court Judgement (CCJ) is issued by a County Court if you fail to pay money that you owe.

If you have an outstanding debt that is not being paid, your Creditor can apply to the Court for a County Court Judgement. The Court assesses if there really is a debt to pay, if they decide there is, they will issue a CCJ and determine how the debt should be repaid. The average CCJ size is around £3,300.

You know this process is happening, as you will be sent a CCJ Claim form prior to the judgement being made. This gives you the opportunity to state your side of the case.

When the Court date arrives, you do not need to attend if you are not disputing the claim.

What if I don’t pay a CCJ?

If you do not pay the CCJ inside the terms decided by the Court, your Creditors may ask the Court to enforce the order. If they do, this legal cost will be added to your debt.

The action then may include:

1. A warrant of execution where a court-appointed bailiff takes your goods in order to sell them to help pay the debt.

2. An attachment of earnings allows the debt to be repaid directly from your salary by your employer. This can obviously result in a difficult situation with your employer knowing about your debt issues.

3. A charging order – where a charge is placed against your property to deduct your debt from sale proceeds. This will make it difficult for you to mortgage or remortgage your property.

4. A third-party debt order that freezes your bank account until you pay the debt due.

Mortgage Arrears

Mortgage arrears are a serious problem and may lead to you losing your home. However, no Mortgage Lender likes to repossess, and they will take steps to assist you through difficult financial periods and get you back on track.

The worst thing you can do if you do not have the funds to make your mortgage payment is not to inform the Lender. The sooner the Lender knows, the sooner they can help you.

If you ignore mortgage arrears and do not contact your Lender they will have to assume the worst and act accordingly.

If you have had mortgage arrears in the past, you will be aware that the normal route is for the Lender to arrange a slightly higher monthly payment with you once things have settled down to repay the arrears.

Of course, mortgage arrears on your record are not attractive to prospective mortgage lenders when you seek to remortgage or purchase a new property.

1 in 12, 0 in 3

When dealing with mortgage arrears, you may hear terms like 1 in 12 and 0 in 3. This means the lender is looking for a maximum of one missed payment in the last 12 months and none in the last three months. The more recent your missed mortgage payments, the more difficult it will be to arrange a mortgage.

Payday Loans

Payday loans are short term cash loans arranged by a number of providers in the UK. Since 2008, payday loans have started to become big business and the companies operating in this area have the financial resources for major sponsorship of football teams and a number of TV advertising campaigns. Why can they do this? –  because the business is so profitable for them, interest rates on these loans can run into the 000’s% range.

Getting a Mortgage with Bad Credit due to Payday loans

The current position is that bad credit lenders do not have defined criteria for applicants with pay day loans on their record. As a result, we cannot predict how a lender will react to pay day loans on your credit report. The pattern appears to be that one or two recent pay day loans can be tolerated, as can historical pay day loans. Applicants with numerous recent pay day loans are likely to be declined by mortgage lenders.

Bad Credit Mortgages and Debt Management Programmes

Under a debt management programme, a third party becomes involved in your situation. This person negotiates with your creditors to reduce your monthly payments to a level you can afford within your income, or perhaps even to write off some of your debt.

Under a debt management programme, you will set out your essential monthly outgoings such as food, mortgage or rent, rates, bills, travel, etc, and a calculation will be made as to how much you can afford to repay your creditors.

A debt management programme can be advantageous as it will stop your creditors from chasing you by phone and post, taking much of the stress away.

There are a number of private companies offering debt management services, but you should be aware that they will charge a fee to assist you.

There are Government and Charitable bodies who will assist you for free.

A good starting point is to visit your local Citizens Advice Bureau.

Mortgage lenders are not keen on debt management plans and your chances of arranging a mortgage or re-mortgage if you have one in place are slim.

Bad Credit Mortgages and Bankruptcy

Bankruptcy is the final step if you cannot pay your debts. It gives you the opportunity to wipe the slate clean and start again. It does, however, seriously affect your chances of obtaining future credit and will impact your lifestyle in the short term.

A Bankruptcy order may be requested by yourself or by your creditors (provided you owe the petitioning creditor at least £750). Under the order, your assets are turned to cash and your creditors pay as much as possible from the proceeds.

After a Bankruptcy order, you need to stop using your bank account(s). You also need to declare you are bankrupt if applying for any credit above £500.

A trustee will be appointed to handle your bankruptcy and the repayment of your debt.

Bad Credit Mortgages and Bankruptcy and your home
If you own your home with or without a mortgage, your interest in the home will form part of your estate which will be dealt with by your trustee. The home may have to be sold to go towards paying your debts.

If your husband, wife or children are living with you, it may be possible for the sale of the property to be put off until after the end of the first year of your bankruptcy.

Your husband, wife, partner, relative or friend may be able to buy your interest in your home from the trustee. Such a purchase would prevent a sale of the property by the trustee at a future date.

Your spouse or any other interested party should take legal advice about the home as soon as possible

Bad Credit Mortgages and Bankruptcy and the Self-Employed

If you are made bankrupt, your business is shut down and your staff dismissed. There is no restriction on a bankrupt being self-employed, so you may start trading again.

How long will you be bankrupt?

The bankruptcy period lasts for up to 12 months (it can finish earlier). The impact of the bankruptcy on your financial situation can last much longer.

Alternatives to Bankruptcy

You can consider an Individual Voluntary Arrangement (IVA). This gives you more say as to how you pay your creditors and it may be easier to keep your home than under bankruptcy. You will avoid the restrictions of bankruptcy and the overall costs to you may be less.

Bad Credit Mortgages and Individual Voluntary Arrangement

An IVA is a type of debt relief order and in order to arrange one you will need to appoint an insolvency practitioner to handle your case – or appoint the official receiver.

Under an IVA, agreed payments are made with your Creditors over a set period of time in order to avoid bankruptcy. Whilst you are in an IVA, your options for further financial arrangements are severely limited.