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Bad Credit Mortgages

Mortgage Options For People With Bad Credit

Think bad credit means you can’t get a mortgage? Think again. With the right financial advice, you can explore more flexible mortgage options and get your credit score back on track.

Understanding your mortgage options can be difficult, especially when you have bad credit. By reading our expert guides, we hope that you can feel more confident about your options and reach out to the specialist mortgage professionals to get the ball rolling.

Posted On: February 2, 2023
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Updated On: February 8, 2023

Credit Scores Explained: Do They Affect Mortgage Applications?

The best way to understand credit scores and why they’re an important part of any mortgage application is to think like a lender.

When all you want is to own a home of your own, it’s easy to see lenders as obstacles to that goal. However, they act as gatekeepers that have to protect their own financial interests.

The credit score was introduced as a way to easily gauge how much of a risk people pose when looking to borrow money. Credit scores show how you’ve handled previous debts and credit. The more evidence you have of responsibly handling your finances, the higher your score will be. A high score is good.

These scores are not just for the lenders. They are also forecasts for those looking to secure a mortgage. In this guide, we’re showing you how to interpret your score and what to do depending on your rating.

Do credit scores affect mortgage applications?

Yes! Credit scores will affect mortgage applications. This is because they highlight key areas of your financial history. Financial issues are not all created equal and are categorised based on severity.

Factors that the report will take into account include:

  • County Court Judgements (CCJs)
  • Bankruptcy
  • Individual Voluntary Arrangements (IVAs)
  • Repossessions
  • Mortgage arrears
  • Late or missed payments
  • No credit history
  • Defaults

How do you access your credit score?

There are three main credit reference agencies, Experian, Equifax and TransUnion, which you can access online. You may need to create an online account, but it will be free to access your report.

Understanding your score – What do the numbers and ratings mean?

Once you have your score, you won’t just want to know that you have a ‘poor’ or ‘excellent’ rating. You’ll want to know what this means in terms of your mortgage application.

It’s important to bear in mind that credit scores are not the sum-total of what a lender will review. They will also look at your income, spending and saving habits and the finances of a joint mortgage partner.

Experian

Score varies from 0-999

Poor: Below 721
Good: 881 to 960
Excellent: 961 or above

Equifax

Score varies from 0-700

Poor: Below 380
Good: 420 to 465
Excellent: Above 466

TransUnion

Score varies from 0-710

Poor: Below 566
Good: 604 to 627
Excellent: Above 628

Good or Excellent

If your score is Good or Excellent, you don’t need to worry so much. If you maintain this score, you should be able to access some of the best deals on the market.

Bad or Very Poor

If your credit score is bad or very poor, you may be declined a mortgage or struggle to find one without very high interest rates. However, this doesn’t mean you can’t get a mortgage full stop. It’s worth speaking to a specialist mortgage advisor as they will have access to lenders with more flexible lending criteria. They will also be able to offer advice on how you could boost your score.

Need help finding a mortgage with bad credit?

Speak to the experts at Agentis today. We are adverse credit mortgage specialists who can help you navigate the mortgage market without the jargon. If you have a poor or bad score, don’t despair. There are plenty of ways you can boost your credit score, some of which can be done in a quick time frame with little to no expense on your part.