Bad Credit

Can I get a mortgage with bad credit?

Yes, you can. Not every lender will say yes, but many will especially the ones we work closely with. While some high-street banks are strict, there are plenty of specialist lenders who understand that life happens.

Depending on your situation, you may need a larger deposit (usually 15–20%) and you might pay slightly higher rates but securing a mortgage is absolutely possible.

What credit issues can affect your mortgage?

Different lenders treat credit issues differently. Here’s how the most common ones are viewed:

• Late payments: A few late payments, especially older ones, won’t necessarily stop you. If you’ve kept up with mortgage or rent payments, that works in your favour.
• CCJs (County Court Judgements): CCJs under six years old can still be considered especially if satisfied. If your CCJ is older, it often won’t affect your chances.
• Defaults: Defaults over three years old are less of a concern. If recent, lenders may ask for more detail. More defaults = fewer options, but it’s still not a dead end.
• Debt Management Plans (DMPs): If you’re still in a DMP, options are limited but not impossible. Most lenders prefer to see the plan completed and payments made on time.
• IVAs (Individual Voluntary Arrangements): You’ll usually need to be discharged for 1–2 years before applying. Clean behaviour post-IVA is critical.
• Bankruptcy: Some lenders will consider applications 1–3 years after discharge. You can’t apply while still bankrupt, but recovery is possible.
• Other issues: Repossession, debt relief orders, or no credit history at all can also impact your mortgage. But we’ve helped clients in all these scenarios get approved.

How to improve your chances of a mortgage with bad credit

Here’s how you can strengthen your mortgage application if you’ve had credit problems:

1. Get organised: Cut unnecessary spending 3+ months before applying. Pay bills on time and reduce any remaining debt where possible.
2. Download your credit file: Use tools like Checkmyfile or Experian to see exactly what lenders will see. Spot errors and keep track.
3. Build your score: Use your credit card monthly but pay it off in full. It shows lenders you can borrow responsibly.
4. Save more deposit: The more you can save, the better your rates and chances. Aim for 15–20% if possible.
5. Talk to Option Finance: Our advisors match you with lenders based on your unique situation. We do the heavy lifting and protect your credit score in the process.
6. Explore support: Gifted deposits or applying with a partner (especially one with stronger credit) can give you a significant boost.

Should I wait or apply now?

There’s no one-size-fits-all answer. Sometimes it’s smart to wait, rebuild, and apply later. Other times, waiting only delays your progress unnecessarily.

Advantages of applying now:

• You may already be eligible even with poor credit
• You’ll stop paying rent and start building equity
• Repaying a mortgage helps rebuild your credit long-term

Things to consider:

• Bad credit mortgages usually require bigger deposits
• You may pay higher interest rates or fees
• You’ll have fewer lenders to choose from

We’ll help you understand both sides and decide what’s right for you.

Which lenders offer bad credit mortgages?

We work with many lenders who regularly approve applicants with credit issues. Here are just a few:

• Bluestone: Accepts defaults and CCJs under £300. May approve applicants with credit issues in the past 6 months.
• Vida Homeloans: One of the most flexible lenders for discharged IVAs and bankruptcies (3+ years).
• Norton: Accepts DMPs, defaults, and CCJs even if they’re active or recently resolved.
• Kensington: Great for late payments, satisfied CCJs and DMPs. Doesn’t currently accept bankruptcies.
• Precise: Accepts older IVAs and bankruptcies (6+ years), plus recent CCJs and defaults (3+ months old).
• LendInvest: Accepts recent CCJs and defaults. Doesn’t accept IVAs or bankruptcies.

Important: Each lender has other criteria around income, deposit, and affordability. Our mortgage experts will make sure you meet all of them before applying.

Let’s make a plan together

If bad credit is holding you back, we’re here to change that. At Option Finance, we don’t judge we solve.

Book a free call with one of our advisors today. We’ll review your situation and show you what’s possible no pressure, no obligation, just real solutions.

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