If you have had credit problems in the past, it is easy to assume a mortgage is out of reach. In reality, the answer often depends on what the issue was, how recent it is, and what the rest of your application looks like.
At CW Mortgages, Ian Smith helps clients across Essex understand whether a mortgage may still be possible and which factors are likely to matter most.
What do lenders mean by bad credit?
Bad credit can cover a range of issues, including:
- missed payments
- defaults
- CCJs
- payday loan history
- high credit card usage
- debt management history
- recent financial pressure showing on bank statements
What affects your chances?
Whether you may still be able to get a mortgage often depends on:
- how serious the credit issue was
- how long ago it happened
- whether there have been repeated problems
- your income and affordability
- your deposit size
- how your bank statements look now
- whether you are a first-time buyer, moving home or remortgaging
Can first-time buyers get a mortgage with bad credit?
Sometimes, yes. Bad credit can make a first mortgage more complicated, but it does not always stop you buying.
Can you remortgage with bad credit?
Some homeowners need to review their mortgage after financial difficulties, missed payments or other credit issues. In those cases, it is important to assess whether remortgaging is realistic now, whether a product transfer may be more suitable, or whether waiting could improve the outcome.
What can improve your chances?
Depending on your situation, it may help to:
- check your credit file early
- correct any errors on your reports
- reduce outstanding balances where possible
- avoid taking on unnecessary new credit
- keep your bank statements sensible and easy to explain
- build a clear deposit trail
- speak to a broker before making assumptions
When should you ask for advice?
The earlier, the better. Getting advice before you apply can help you avoid unrealistic expectations, wasted applications and unnecessary damage from applying to the wrong lender.
If you want a clearer idea of what may still be possible, speak to Ian Smith at CW Mortgages about your situation.
