If you have bad credit, getting a mortgage can feel much harder than it should. Maybe you have missed payments, defaults, a CCJ, payday loan history, a debt management plan, or simply a low credit score. Whatever the reason, it is easy to assume that a mortgage is completely out of reach.
The good news is that bad credit does not automatically mean you cannot get a mortgage in the UK.
However, it does mean lenders will look more closely at your application. They will want to understand what happened, how recent the credit issues are, whether they have been resolved, and whether the mortgage is affordable now.
In this guide, we explain how bad credit mortgages work, what lenders look for, and what you can do to improve your chances of being accepted.
What Is a Bad Credit Mortgage?
A bad credit mortgage, sometimes called an adverse credit mortgage or impaired credit mortgage, is a mortgage for people who have had credit problems in the past.
This might include:
- Missed or late payments
- Defaults
- County Court Judgments, also known as CCJs
- Debt management plans
- Individual Voluntary Arrangements, also known as IVAs
- Bankruptcy
- High levels of unsecured debt
- Payday loan use
- Previous mortgage arrears
Bad credit mortgages are not a separate legal product. They are usually standard mortgage products offered by lenders who are willing to consider applicants with credit issues.
Some high street lenders may decline applications with recent or serious adverse credit, but specialist lenders may take a more flexible approach.
Can You Get a Mortgage with Bad Credit?
Yes, it is possible to get a mortgage with bad credit in the UK, but it depends on the details of your situation.
Lenders will usually look at:
- What type of credit issue you have
- How long ago it happened
- Whether the debt has been repaid or settled
- How much the debt was for
- How many credit problems appear on your file
- Your income and employment stability
- Your deposit amount
- Your current debt levels
- Whether the mortgage is affordable
A small settled default from several years ago is usually less of a problem than multiple recent defaults or ongoing arrears. Lenders tend to be more comfortable when they can see that the credit issue was historic, explained, and no longer part of your current financial position.
How Recent Is the Bad Credit?
Timing matters a lot.
The more recent the bad credit, the more difficult it can be to get approved. A missed payment from last month will usually be treated more seriously than a default from four or five years ago.
As a general rule, lenders may view your application more positively if:
- The credit issue happened several years ago
- The account has been settled
- You have had clean credit conduct since
- Your bank statements show stable income and sensible spending
- You are not currently relying on credit to cover everyday costs
Defaults, CCJs and other negative markers can usually remain on your credit file for six years. That does not always mean you must wait six years before applying, but it does mean lenders may still be able to see them during that period.
Can You Get a Mortgage with Defaults?
Yes, some lenders will consider applicants with defaults.
The outcome usually depends on:
- The date the default was registered
- The value of the default
- Whether it has been satisfied
- How many defaults you have
- Whether the default was for unsecured credit, utilities, telecoms, or another type of account
A settled default from two or three years ago may be acceptable to some lenders, especially if the rest of your application is strong. A recent default, or several unpaid defaults, can make things more difficult.
If you have defaults, it is important to check that the dates and balances are reporting correctly. An incorrect default date or wrongly reported balance could affect which lenders are available to you.
Can You Get a Mortgage with a CCJ?
Some lenders will consider a mortgage application with a CCJ, but the details matter.
Lenders will usually want to know:
- When the CCJ was registered
- How much it was for
- Whether it has been satisfied
- How long it took to settle
- Whether there are any other credit issues
A small, satisfied CCJ from several years ago may be easier to place than a large, recent, unpaid CCJ. If you have a CCJ, it is worth getting advice before applying, as applying to the wrong lender could lead to unnecessary declines and hard searches.
How Much Deposit Do You Need for a Bad Credit Mortgage?
The deposit needed for a bad credit mortgage varies depending on your credit history, income, property type and lender.
In general, the stronger your deposit, the better your chances may be.
Some applicants with lighter or older adverse credit may be considered with a smaller deposit. However, if the credit issues are recent, serious, or unresolved, lenders may ask for a larger deposit to reduce their risk.
A larger deposit can also sometimes help you access better rates, although this is not guaranteed.
Will the Interest Rate Be Higher?
Bad credit mortgages often come with higher interest rates than standard high street mortgages.
This is because the lender sees the application as higher risk. The rate you are offered will depend on your credit profile, deposit, income, affordability, property, and the lender’s criteria at the time you apply.
Although the rate may be higher at first, some borrowers use a bad credit mortgage as a stepping stone. After a period of clean payments and improved credit conduct, it may be possible to remortgage to a better deal later, depending on your circumstances and market conditions.
What Do Lenders Look at Besides Your Credit Score?
Your credit score is only part of the picture.
Mortgage lenders usually care more about the detail behind your credit file than the score number itself. They will also look at affordability, income, spending habits, deposit, employment, and the property you are buying.
Important factors include:
- Your income and how reliable it is
- Your employment type and length of time in role
- Your monthly debt repayments
- Your bank statement conduct
- Your deposit source
- Your age and mortgage term
- The property condition and valuation
- Whether the mortgage remains affordable if rates change
This is why two people with similar credit scores can get very different mortgage outcomes.
Can a Mortgage Broker Help with Bad Credit?
A mortgage broker can be especially helpful if you have bad credit.
This is because different lenders have very different rules. One lender might decline an application because of a default, while another might accept it if it is over a certain age or below a certain value.
A broker who understands adverse credit mortgages can help identify which lenders are more likely to consider your situation before you apply.
This can reduce the risk of wasted applications, unnecessary hard searches, and avoidable declines.
How to Improve Your Chances of Getting a Mortgage with Bad Credit
Before applying for a mortgage, it is worth taking time to get your application into the strongest possible position.
1. Check all three credit reports
Different lenders use different credit reference agencies. Check your credit reports with Experian, Equifax and TransUnion so you can see what lenders may see.
2. Correct any mistakes
If a default date, balance, address, or account status is wrong, raise a dispute with the lender or credit reference agency. Incorrect data can affect your mortgage options.
3. Avoid new borrowing before applying
Taking out new credit shortly before a mortgage application can make lenders nervous, especially if you already have adverse credit.
4. Keep your bank statements clean
Lenders may review your bank statements. Regular overdraft use, gambling transactions, unpaid direct debits, or reliance on credit can cause concerns.
5. Reduce debts where possible
Lower monthly commitments can improve affordability. Paying down credit cards, loans, or other debts may help strengthen your application.
6. Save the biggest deposit you can
A larger deposit can give you more lender options and may reduce the perceived risk for the lender.
7. Be honest about your credit history
Trying to hide credit problems rarely helps. Lenders will usually find them during checks. A clear explanation is often better than an unexplained issue.
Should You Wait Before Applying?
Sometimes applying now makes sense. Other times, waiting a few months could put you in a better position.
Waiting may help if:
- A default or CCJ is about to become older under lender criteria
- You can settle outstanding adverse credit
- You can reduce your debts
- You can save a larger deposit
- Your bank statements will look stronger in a few months
- You have recently changed job and want more payslip history
However, waiting is not always necessary. The right option depends on your circumstances, the property, your deposit, and the lenders available at the time.
Bad Credit Mortgage Myths
“Bad credit means I definitely cannot get a mortgage”
Not true. Some lenders specialise in applicants with adverse credit. The details matter.
“My credit score is low, so I will automatically be declined”
Not necessarily. Lenders look beyond the score and assess the full application.
“I need to wait six years after a default”
Not always. Some lenders may consider defaults before they drop off your credit file, depending on the age, value and status of the default.
“All lenders have the same rules”
No. Criteria vary widely between lenders. This is why choosing the right lender is so important.
Final Thoughts
Getting a mortgage with bad credit in the UK can be more challenging, but it is not impossible.
The key is understanding how lenders will view your situation. Recent, unpaid, or serious credit issues can limit your options, while older or settled problems may be easier to work around.
If you have bad credit and are thinking about applying for a mortgage, the best first step is to review your credit files, understand what is being reported, and get advice before making an application.
The right lender, the right timing, and a well-prepared application can make a big difference.
