Can I still get a mortgage with bad credit?

If you have bad credit, you can still get a mortgage. A poor credit history doesn’t automatically rule you out of getting on the property ladder, but it can limit the lenders and deals open to you.

It’s not just your credit score that counts. Your options will likely depend on the type of credit issue, how serious it was, and how long ago it happened, alongside your deposit, income, and affordability. Every lender sets their own criteria, so one lender’s “no” can easily be another’s “yes”.

You may face higher costs or need a bigger deposit, and approval is never guaranteed. But with some preparation and the right lender from the start, a mortgage is often more achievable than people expect.

At Bennison Brown, we’ve been helping first-time buyers and remortgagers with bad credit mortgage applications for years. We created this mortgage guide to help you understand how bad credit can affect your mortgage application so you can get a clearer picture of your financial situation and improve your mortgage chances. Keep reading, or get in touch with one of our brokers for personal advice.

What do mortgage lenders consider to be bad credit?

There is no single definition of bad credit history. Lenders tend to use the term “adverse credit” for anything on your credit file that suggests you’ve struggled with borrowing in the past, such as:

Missed or late payments
Defaults
County Court Judgments (CCJs)
Mortgage arrears
An Individual Voluntary Arrangement (IVA)
A Debt Management Plan (DMP)
Being declared bankrupt

Some lenders also look at heavy payday loan use, frequent overdraft reliance, or multiple recent credit applications.

Your credit history and credit rating are based on information held by the three main credit reference agencies in the UK: Experian, Equifax, and TransUnion. Lenders may check one or more of them, and the information they hold can differ slightly. But it’s the detail of your file that matters more than a single score, so what worries one lender may be acceptable to another.

How do bad credit mortgages work?

A bad credit mortgage (often called an adverse credit mortgage) works in the same way as any other mortgage. You borrow money to buy a property or remortgage, repay it with interest over an agreed term, and the loan is secured against your home. It’s just designed for people with a low credit score or credit issues in the past.

The difference lies in how the lender assesses risk. Some mainstream lenders will consider applicants with minor or older credit problems. But in bad credit applications, specialist lenders will be more interested in looking at your full circumstances rather than relying only on your bad credit rating.

Each application is on a case-by-case basis. Most lenders check affordability by reviewing your income, regular outgoings, existing debts, and living costs to confirm you can afford the repayments, including if interest rates rise.

You may need a larger deposit or pay higher interest rates than someone with a clean file. That’s why finding mortgage providers whose criteria fit your situation matters so much.

Which credit issues can affect you getting a mortgage with bad credit?

Not all credit issues are treated the same, and a bad credit score is often more workable than people expect. Lenders generally consider three things: how serious was it, how recent was it, and has it been settled?

Plus, the picture improves with time. Most negative information stays on your credit file for six years, and older issues usually concern lenders far less than recent or unpaid ones.

Missed or late payments

A single late payment on a credit card or phone contract is usually less of a concern than a pattern of missed payments. Lenders look at how many there were, how recent they are, and whether they involved a mortgage or rent.

Missed payments in the last 12 months can narrow your lender options. Older, one-off late payments are often easier to explain, and a good run of payments since then works strongly in your favour.

Defaults

A default usually means an account was closed after a lender decided you were seriously behind on payments. Lenders consider the number of defaults, the amounts involved, how long ago they were registered, and whether they have been settled.

A small, older, satisfied default is viewed far more favourably than a recent, large, or unsatisfied one. Some lenders won’t consider unsatisfied defaults, while others may in certain circumstances.

County Court Judgments (CCJs)

A CCJ is a court order, usually issued when a debt hasn’t been repaid after a claim was made. It is recorded on the public register and on your credit file.

If you pay a CCJ in full within one month, it can be removed from the Register of Judgments, Orders and Fines. If you pay it later, it’s marked as satisfied but stays on your file for six years. Lenders often treat paid CCJs more favourably than older ones, so settling a judgment can make a real difference.

Mortgage arrears

Arrears on a previous mortgage are usually seen as more serious than problems with unsecured credit, because they relate directly to the type of borrowing you are applying for. Lenders will want to know how many months you were behind, how recently it happened, and how it was resolved.

Some lenders won’t consider recent mortgage arrears, but some specialist lenders may. Showing how your situation has changed and how you manage mortgage repayments now can make a meaningful difference.

Bankruptcy and IVAs

Bankruptcy is one of the most serious credit events, and many mainstream lenders won’t lend after it. But it is still possible to get a mortgage with some specialist lenders. They may consider your application after a certain amount of time has passed since your bankruptcy was discharged. This waiting time and the deposit needed will vary depending on the lender.

The same principle applies to IVAs and similar arrangements. The more time that has passed, and the more stable your finances are now, the stronger your position is likely to be.

Is there a minimum credit score for an adverse credit mortgage?

There is no universal minimum credit score for a mortgage. Each lender uses their own scoring system and criteria, and these are not published in a standard form. That means a low score on a credit-checking app is not the final word on your chances.

The scores you see from Experian, Equifax, TransUnion, or free credit-checking apps aren’t the same as the ones mortgage lenders use internally. Lenders look beyond the number at the type, age, and status of anything on your credit file, along with your income and affordability. This is why two people with the same score can get different outcomes, and why your overall profile can outweigh a single figure.

Not sure where you stand? Our advisors can look at your credit history with you and tell you honestly what’s realistic before anything is recorded on your file, protecting your credit record while you search. Get in touch if you’re curious about your options.

Can a larger deposit help if you have bad credit?

Having a larger deposit reduces the amount you need to borrow compared with the value of the property, known as the loan-to-value (LTV). A lower LTV means less risk for the lender, which can widen your choice of lenders and may improve the rates you are offered.

Lenders that accept adverse credit often ask for a bigger deposit than they would from someone with a clean file. The amount varies by lender and by your credit history, but overall, a larger deposit helps reassure lenders that you’re a responsible borrower.

Will bad credit mean a more expensive mortgage deal?

It can, but it doesn’t have to be as costly as you might fear. Different lenders price mortgages based on risk, so if your credit history suggests a higher risk, you may be offered a higher interest rate or fees. Some applicants with minor or older issues still secure deals close to standard rates.

Remember that the headline rate is only one part of what you’ll pay. Arrangement fees, valuation fees, early repayment charges, and the length of any fixed period all matter, on top of the other costs of moving house. A cheaper-looking deal isn’t always the better one once everything is added up.

Many borrowers start with an adverse credit mortgage and later remortgageto a better deal as their credit history improves.

How will bad credit affect my monthly payments?

Bad credit does not change how a mortgage is repaid, but it can change the numbers. A higher interest rate means a higher monthly payment on the same loan. The exact difference depends on the amount borrowed, the term and the rate, so it is worth looking at the figures for your own situation.

For example, on a £300,000 repayment mortgage over 30 years, a rate of 4.5% works out at around £1,520 a month. At 5.5%, it’s around £1,703, roughly £183 more each month.
(These rates are for illustration purposes only.)

Lenders will also “stress test” whether you could still manage your payments if rates rose. If a higher rate pushes the payment beyond what your income can support, the amount you can borrow may be reduced. It’s a safeguard that helps you borrow comfortably now and in the future.

Practical steps you can take before applying for a bad credit mortgage

Much of your credit position is within your control, and a few focused steps can strengthen your application. These offer a good place to start.

Check your credit reports

You can get your statutory credit report for free from Experian, Equifax, and TransUnion, and Money Saving Expert has a guide on how to do this. But since each agency can hold slightly different information, it’s worth checking all three, which is quite straightforward through Checkmyfile. You get a free 7-day trial, and then it’s £14.99 a month, and you can cancel online at any time. (This is a referral link, so we may receive a small payment if you sign up.)

Whichever route you choose, look past the score at the detail. Note any defaults, CCJs, missed payments, or accounts you do not recognise, and check whether they are recorded as satisfied or unsatisfied. Knowing exactly what lenders will see puts you in a stronger position.

Correct mistakes

Errors on credit files are more common than people expect. You might see an old address, an account that is not yours, a debt you have already paid that still shows as outstanding, or a financial link to someone you no longer share finances with. If you find an error, contact the lender that supplied the information and the credit reference agency to ask for it to be corrected. Fixing a mistake can improve your file. It can take time, so start early.

Make payments on time

Paying every bill and credit commitment on time is one of the most effective ways to rebuild your credit profile. Setting up direct debits can help you avoid accidental missed payments, and lenders like to see a recent run of well-managed accounts. The longer that run, the more it can help offset older problems.

Reduce outstanding debt where it makes sense

Lowering your balances on credit cards and loans can improve your affordability, since lenders compare your overall level of debt with your income. But paying off debt could reduce the savings you have for a deposit, so get advice on the balance that works for you.

Avoid repeated credit applications

Each time you apply for credit, it usually leaves a hard credit check on your file. Several in a short space of time can make you look high risk. The same applies to mortgage applications, so don’t apply to lender after lender to see who says yes. At Bennison Brown, we check lender criteria first, so you only apply where you have a realistic chance of approval.

Register to vote

Being on the electoral roll at your current address helps lenders confirm who you are and where you live, and credit reference agencies use it during identity checks. It’s one of the quickest ways to improve your credit score, and you can register online at GOV.UK.

Build your deposit

The more you can put down, the more options you are likely to have. Even a modest increase in your deposit can reduce your LTV and may improve the deals available. Regular saving also shows lenders you can manage your money consistently. You might be eligible for first-time buyer schemes, which also help keep the costs down.

Get advice before applying from a mortgage broker

Lender criteria on adverse credit vary widely and aren’t always easy to find. A mortgage broker can assess your circumstances, find potential lenders likely to consider you, and help you apply in the right order, so you avoid unnecessary searches and declines. For borrowers with a complicated history, speaking to a broker before applying is often the step that makes the biggest difference.

Speak to Bennison Brown to get advice on bad credit mortgages

If you have a complicated credit history, you do not have to work out your options alone. At Bennison Brown, our advisers regularly help people with less-than-perfect credit files, and we know how differently lenders can treat the same problem.

We’ll look at your full circumstances, including your credit file, income, deposit, and goals, then explain honestly what is realistic. We work with a wide range of lenders, including specialists for first-time buyers and those whose deals you won’t find on the high street. We’ll find the ones whose criteria suit you before making any applications.

If you’re ready, call Bennison Brown today on 0207 427 6067 or contact us online, and we’ll have a no-pressure conversation about where you stand and what your next step could be.

Frequently asked questions about getting a bad credit mortgage

Is it better to wait before applying for a bad credit mortgage?

Ultimately, it depends on your circumstances. Lenders don’t look for a specific credit score, but as adverse credit ages, it generally becomes less of a concern, and a longer record of well-managed accounts can strengthen your application. Waiting can also give you time to build a bigger deposit and settle outstanding debts.

If you are not quite ready to apply, we can show you what could improve your position and roughly how long it might take. If a mortgage is within reach, we will guide you through each step.

Do mortgage calculators take into account bad credit?

Generally, no. Most online mortgage calculators estimate payments or borrowing using figures such as the loan amount, interest rate, term, and income. They usually don’t consider your credit history, and the rates they use may not reflect what you would be offered with adverse credit.

A calculator can be a useful starting point, as long as you treat the result as a rough guide. Your actual borrowing and rate will depend on the lender’s assessment of your credit file and affordability, which our brokers can help you navigate before you start an application.

Are there specialist “adverse credit” lenders?

Some lenders specialise in applicants with a history of credit problems, and many mainstream lenders also have criteria that allow certain adverse credit in limited circumstances. Specialist lenders often take a more individual view of your case rather than relying on automated scoring.

Their deals can come with higher rates or fees, and they will not suit everyone. Because criteria differ so much between lenders, explore our available mortgage guides and get advice on which are likely to consider your application before you apply.