Can you get a mortgage with bad credit?

Yes, you may still be accepted even if your credit record puts off most lenders.

You could use it to buy your first property, move house or remortgage your current home.

What is bad credit?

Your credit record is an electronic document containing your financial history that lenders can see if you apply for credit like a mortgage, loan or credit card.

If your credit record includes missed payments, too much debt or problems like bankruptcy and CCJs, this is known as bad credit.

What mortgages can you get with bad credit?

Fewer lenders are likely to let you borrow money, which means:

  • There will be a smaller range of mortgages to choose from

  • Those you can get are likely to be more expensive

  • You will usually need a higher deposit (usually 15% or more)

However, some offer mortgages designed for bad credit. They are offered by specialist bad credit mortgage lenders and building societies rather than larger high street banks.

They are also known as adverse credit or sub prime mortgages and work in the same way as normal mortgages. As well as checking your credit record, lenders will ensure you can afford repayments on the mortgage by looking at your income, outgoings and financial situation.

How to get a mortgage with bad credit

Comparing as many deals as possible can help you find a cheaper mortgage.

Our bad credit mortgage comparison lists specialist mortgages that may accept you.

Using a broker or financial adviser could increase your chances because many bad credit mortgages are only available through them. Use our form to find a mortgage broker.

Your credit record affects the cost of a mortgage

Bad credit means it will cost you more to get a mortgage. The lenders that are willing to accept you charge more because of the risk that you could miss payments.

These costs include:

How to improve your credit record

The best way to improve your credit record is to stay on top of what you borrow. Make sure you:

  • Always make your repayments in time

  • Stay in your credit limit or overdraft limit

  • Avoid applying for too much credit

  • Keep your name and address details up to date

Here are more ways to improve your credit history.

If your credit record improves, you may be able to:

Get accepted for a mortgage

If you are currently unable to get a mortgage, wait for at least a few months before you apply again. Check your credit record, and when it has improved you will have a better chance of getting accepted.

Get a lower interest rate

Repaying your mortgage on time every month should improve your credit record. This will give you a wider choice of mortgages, meaning you could get a cheaper deal.

When your credit history has improved you may be able to get a better deal with a lower interest rate by remortgaging.

How to check your credit record

You can pay to do this through a credit reference agency or check it for free. Here is how to check your credit record for free.

What if you have no credit record?

If you have never borrowed money or used any form of credit, your credit record will not give lenders any idea of how well you can handle repaying a mortgage.

Borrowing money and paying it off in full when it is due can improve this. Here is how to build your credit record.