Bad Credit Mortgages

Getting a Mortgage with Bad Credit

Have you been denied a mortgage based on your credit history? Have you ever wondered how to get a mortgage with bad credit? Our aim at Just Mortgage Brokers is to make it easier for you to find a mortgage regardless of your credit score.

We understand that it can be difficult to find a lender willing to provide a mortgage in these circumstances, but with help from our specialist advisors, you can get access to a potential mortgage with minimum fuss.

Get started today with our bad credit mortgage calculator below.

Bad Credit Mortgage Calculator

What Is Bad credit?

A bad credit mortgage is simply a term used to describe a mortgage arranged with a specialist lender for a borrower who has experienced financial difficulties in the past.  Typically, a bad credit mortgage for someone who has had debt problems will be offered at a slightly higher rate than that found from your usual high street lenders and may also require a slightly bigger deposit or a larger amount of equity.

In our experience however, it is not necessarily the case for everyone that, just because they have experienced problems in the past with their credit, they will need to go down the route of getting a bad credit mortgage from a specialist lender.  The market has evolved over the last few years and some mainstream lenders are now considering elements of adverse credit, and those eligible can still obtain standard interest rates.  Our expert advisers are fully qualified and following an initial discussion and sight of your credit report should be able to ascertain which route you may have available.


Looking at it dispassionately, ‘bad credit’ is based entirely on the perception of whoever is looking at your borrowing history. Unfortunately, some people or lenders will see even the merest infraction on your credit record – perhaps a missed instalment on a card, or late payments on a utility bill – as a sign you are not entirely responsible with money. Others will take a broader view and understand that a severe bad credit event in your past does not mean that you have the same problems today.

Technically, there’s no such thing as a specific ‘bad credit’ score. This is because credit scores are calculated in different ways by each of the UK’s three main credit reference agencies – Experian, Equifax and TransUnion. They each acquire information from various sources, aggregate it and score it using different points-based methods to come up with a figure that may or may not accurately reflect the level of risk a borrower might pose. How these scores are interpreted will also vary according to whoever is looking at them, as views will vary from one party to another.

In the end, your credit score is not what will impact the final decision on your level of borrowing; it is the different information that makes up your credit file. Many mortgage providers will simply look at a number for a score, and anything less than what they perceive as acceptable will be declined. Many other lenders will look at your record in more detail and consider the actual events, putting them in context with the wider picture of your borrowing and credit history.

Remember also that your credit history changes with time. Credit reports cover the last six years, so any adverse credit event will slip off your file after that period of time, and will not be shown to potential lenders.

Bad credit mortgage rates

Interest rates offered for bad credit mortgages are invariably higher than that provided by your mainstream lenders due to the perceived additional risk for the lender.  Appetite for lending to those that have experienced credit problems however has increased over recent years and more mortgage providers have entered the market giving much greater choice.  In addition, many lenders have continued to review and improve their rates together with their criteria as the competition increases, and as such margins over the standard mortgage rates have decreased.

The interest rate offered will be determined by the severity of the credit history but, also other factors can be taken into consideration such as your loan to value (sometimes referred to your LTV and determined by the amount of deposit or equity you have).

Typically, due to the complexity of the pricing of bad credit mortgage rates, these are not widely advertised nor shown in best buy tables.  Much more research is therefore required which is where an experienced specialist mortgage advisor should be able to use their knowledge of the varying lenders criteria to source the most suited available product for you.

Bad Credit Mortgage lenders

The kind of lenders that will typically be willing to extend a mortgage to a borrower with bad credit are usually the specialist niche-market lending companies. While still operating under the same rules and regulations as the mainstream providers, so your rights and your home are no less protected, they use far more flexible criteria, consider all kinds of situations and adopt a realistic approach to each applicant’s case.

The mortgage industry is still feeling the scars from the 2008 world-wide financial crisis that led to most lenders heavily restricting the availability of their product to only borrowers with perfectly clean credit histories and larger deposits or a low loan-to-value ratio (if they already had significant equity in their current property), giving providers the most security on the loan as possible.

The mortgage industry is still feeling the scars from 2008. This led to most lenders heavily restricting the availability of their product to only borrowers with perfectly clean credit histories and larger deposits.

As a result, a large sector of homebuyers found it increasingly difficult to obtain home loans, especially those with bad credit. This led to the growth of specialist mortgage providers entering the market, including bad credit mortgage lenders who cater specifically to those who have experienced financial difficulties in the past. Due to the very nature of their business, their criteria for applicants and interest rates are tailored to this sector of the market.

Whilst many mainstream lenders will either have no set rules for dealing with applicants with bad credit (or in fact just one criteria, which rules them out entirely), or will only accept applications for a very restricted range of products, a bad credit mortgage lender will be quite open and detailed about what they are willing to accept. They are likely to spell out types of adverse credit events they will take into account, as well as the amounts involved and the time frames they occurred. An experienced bad credit mortgage broker will be able to use their expertise and knowledge to match the potential borrower to the suitable lenders for their case.

Can you get a mortgage with bad credit?

While it can be more difficult to secure a mortgage with a bad credit history, it’s certainly not impossible for all. Also, there are things you can do that could improve your chances of being accepted for a bad credit mortgage.

How to improve your credit for a mortgage:

  1. Consider doing these things now:
  • If you aren’t on the electoral roll, get registered.
  • Request copies of your credit report from the three main UK agencies.
  • Close any accounts you don’t use – e.g. store or credit cards.
  1. Next, do this:
  • When you get your credit reports, check that the information they contain is accurate. If anything is wrong, get in touch to get it corrected.
  • Make a list of all your sources of income and outgoings, so you understand how money flows into and out of your household. Use this to work out a realistic budget, and stick to it.
  1. Longer term actions:
  • If you’re struggling with your budget, look at the figures again – maybe you haven’t allocated enough for groceries (for example) or you forgot about something.
  • Open a savings account and put something into it every month – no matter how small a sum. When you have a little bit extra – such as your ‘free’ council tax months – put that money into your savings account.

Take a look at our in-depth guide for more guidance on how to boost your chances of being approved for a mortgage with bad credit. For further information on bad credit mortgages, contact our team of specialist brokers. They have a wealth of experience of securing mortgages for people with a history of bad credit and have access to exclusive deals you wouldn’t necessarily find on the high street.



The criteria for assessing a mortgage application will vary from lender to lender, and their approach to your application will differ according to the current level of perceived risk and the nature of your bad credit issue. Usually, you will need to approach a lender who specialises in mortgages for people with bad credit, but, with the mortgage market continually evolving, some mainstream lenders have been known to accept some elements of adverse credit and you may not need the services of a specialist lender.

As a general rule, the lesser the adverse credit event and the more time that has passed since it occured, then the more favourable a mortgage lender will be. For example, an uncleared CCJ within the last 12 months will be a far greater issue than a few missed payments on a store card three years ago.

However, the main deciding factor will be that, whatever your previous money problems, if you are able to show you are now on a firmer financial footing in the long term and have taken steps to improve your credit score, then you will stand a far better chance of being accepted.

We know that no two cases are the same, and that many applicants will be able to find mortgages at standard interest rates, despite financial issues in the past. Once we’ve gone over your individual circumstances and analysed where you currently stand, we’ll be able to recommend the best path to take to successfully obtain a mortgage on reasonable terms.

How Much Will a Bad Credit Mortgage Cost?

A mortgage with bad credit is usually more expensive because the lender will price their products in accordance with their assessment of the level of risk involved. Even with the most forgiving of lenders, and the most rigorous of assessment criteria, the potential risk posed by someone with black marks on their credit history is inevitably greater than that of an applicant with a completely clean record.

However, this will always vary according to your particular circumstances. Lenders understand that a few missed card payments three years ago is far less relevant today than a CCJ within the last twelve months. They will also look at the amount you want to borrow compared to the market value of the property you are aiming to purchase, and the amount of deposit or equity you are able to provide.

Lenders will naturally always want to take a close look at an applicant’s finances to make sure they will be able to repay the loan – especially so if you are applying with a poor credit rating. As well as potentially costing you more in terms of a higher interest rate, you might also find the amount a mainstream lender will consider affordable for you to borrow, considering the level of your monthly payments and other financial commitments, will be less than that of some other lenders. It’ll pay to make enquiries and do some thorough research to find out what lenders’ policies will be, and to take a close look at your household budget yourself, to identify exactly how much you will be able to afford to pay towards your mortgage each month.

With so many variables, it’s impossible to give an exact figure for how much more than a conventional residential mortgage a bad credit mortgage will cost. The main factor to drive down the cost of the mortgage will be a high deposit. If you can provide upwards of 25% instead of the typical 5%–10%, then you may be able to access deals with more usual interest rates. The only way to find out for sure is to talk to one of our specialist team, who will quickly be able to outline your options.

How Do You Know If You Have Bad Credit?

It’s entirely possible that you could be unaware of any bad credit events on your file, or that you have a potentially poor credit rating. It might be that any infringements have simply had no after-effects on your finances, or were so minor that they were not noticeable to you or those around you. You have been able to blissfully carry on with your life, without the experience of being chased by debt collectors or receiving letters from credit card companies, which would have been a clear sign that your credit history is not as strong as it should be.

For some people, the first real sign they have a bad credit rating is when their application for a mortgage is declined by a high street lender. This can be a surprise if you have not had a long credit history period (or no credit history at all), or have not considered any payment errors to be of any significance. For others, it may be less of a shock, simply because they may be aware of missed payments or court actions in the past, but have not seen any impact in their day-to-day lives.

The one sure way to find out if you have a bad credit history is to request a copy of your credit report from the three main UK credit agencies – Experian, Equifax and TransUnion. Each of them collects information and scores it in a different way, so it’s advisable to get a copy from all three to make sure they all have the correct information and spot anything that should be updated.

The process of obtaining your credit report used to take a while, require a written application and a small fee to pay, but thanks to new developments in recent years in managing our finances online, and new rules regarding access to personal information (GDPR), you can now check your credit score on your phone in a matter of minutes free of charge via one of many credit checking apps or websites.

If you have any concerns over what a particular score might mean for your chances of getting a mortgage, speak to one of our team of specialists today. They will be able to advise on your chances of getting a mortgage, who with and how much for, and give you options for the next steps going forward.

Can I remortgage with poor credit?

A poor credit score could be the result of many varying factors and not just simply a history of adverse credit.  Situations such as high levels of available credit where unused credit cards still remain open on record could affect someone’s score, and therefore could be easily rectified if needed.  So yes, it is certainly possible to remortgage with a low credit score however it is very much dependent on your own individual circumstances to be able to answer this question with clarity.

Even if at the time of looking to remortgage with a poor credit score you are unable to do so, with a little planning and expert advice you can hopefully work towards a position of being able to do so and perhaps even obtain a much better suited product at the time of need.

Bad Credit Mortgage Calculator

Many calculators are in existence today to assist you with varying aspects of the house buying or remortgage process.  These vary from indicating how much you may be able to borrow to how much stamp duty you may have to pay.  A bad credit mortgage calculator will help you understand your potential chances of securing a mortgage based on your circumstances and credit rating.  His can be of great use to begin your journey of looking into your possible options.

Bad credit mortgage calculators will ask relevant questions about you specifically so that your response is tailored to your personal situation.  Many will also ask for your credit score as provided by some of the more widely recognised credit reference agencies and as such it is advisable to have this to hand when inputting your details.

Bad credit mortgage advice

Finding yourself in the position of needing bad credit mortgage advice is not probably something that you had planned to do however, if you find yourself in this position you are certainly not alone and join a great number of people who contact us for exactly this.  With many search engines and best buy tables catering in the most part for those who fit the standard mould, these tend to be less applicable to those needing specialist advice.  Speaking to an adviser who is an expert in this sector and who will be able to use their knowledge of the varying lenders criteria, should assist in securing the most appropriate scheme for you.  This may even be on a rate provided by a standard high street mortgage provider from the outset but, where this is not possible and a more specialist rate is on offer, they can work on a plan to get you in a position to get in a more favourable position during your mortgage lifetime.  Contact us today for your free no obligation bad credit mortgage advice.

Bad Credit Mortgage brokers

At Just Mortgage Brokers we receive many enquiries from would be borrowers who find themselves in a position where they have had some credit difficulties in the past.  These are put in contact with one of our many bad credit mortgage advisors who are specifically trained in this area to ensure they are best place to give the most appropriate advice.

In general terms, a bad credit mortgage broker is a title given to an advisor who specialises in this area of the market and who specifically focuses on this to ensure they are knowledgeable in this sector. They will also have the ability to recognise when a bad credit mortgage is required or where a standard lender would still be available.

  • - Are you tied to high street lenders?
  • - Do overdrafts make credit scores worse?
  • - What do I need to get started?
  • - What does a bad credit score look like?
  • - How does bad credit affect you?
  • - Can I apply for a joint mortgage if my partner has bad credit?
  • - Can I refinance a mortgage with bad credit?
  • - Can a mortgage broker help with bad credit?
  • - Is it possible to remove bad credit from your record before seven years?
  • - Does marrying someone with bad credit give you bad credit?


Carl Shave

Carl has worked in financial services since leaving education and specifically the mortgage industry since 1993.   As a cofounder of Just Mortgage Brokers, he believes that good advice should be available to all, regardless of their circumstances.