Skip to content

Bad credit mortgages

Worried that you won’t be able to get a mortgage because you have a bad credit rating? It could still be possible. Here’s what you need to know to find the right mortgage deal for you.

Worried that you won’t be able to get a mortgage because you have a bad credit rating? It could still be possible. Here’s what you need to know to find the right mortgage deal for you.

Written by
Alex Hasty
Insurance comparison and finance expert
Last Updated
9 JANUARY 2024
12 min read
Share article

Can I get a mortgage with a bad credit rating?

If you have a bad credit rating, it’s more likely that you’ll be rejected by mainstream mortgage lenders. There are specialist lenders who could help, but they may put certain conditions in place:

  • The lender is likely to demand a larger deposit than they would on a conventional mortgage.  
  • Many lenders cap the amount they’re prepared to lend at 70% to 80% of the property value.
  • Interest rates are likely to be much higher than for a conventional mortgage.

You might also be asked for a guarantor – usually a parent or older relative. This will reassure lenders that your monthly payments will be covered if you can’t pay them.

What are bad credit mortgages?

A bad credit mortgage, sometimes called an adverse credit mortgage, is one that’s targeted at customers with a poor credit history. For example, customers with County Court Judgments (CCJs) against their name, Individual Voluntary Arrangements (IVAs) or bankruptcy.

Mortgage lenders want to be sure that they’ll get back the money they lend. So to minimise any risk, they tend to offer lower amounts and charge more interest to people with bad credit, compared to those with good credit.

Lenders don’t usually advertise rates specifically for bad credit though. This is because most will consider bad credit applications on a case-by-case basis. The rate you might get could depend very much on your individual circumstances. For example:

  • What type of credit issues you have
  • How recent the issues were
  • Whether any credit issues are still outstanding
  • Your deposit and the amount you need to borrow.

You’re also more likely to be offered a fixed rate mortgage, as these are easier to budget for.

Can I get a mortgage if I’ve been bankrupt, got an IVA or CCJ?

It may depend on the amount of time that’s passed since any County Court Judgment (CCJ) or bankruptcy. In the case of bankruptcy, most lenders will only consider your application after six years have passed since the bankruptcy discharge.

Although a CCJ can stay on your record for six years, some lenders may consider your application after three years – as long as your debt has been fully paid back.

In the case of an Individual Voluntary Arrangement (IVA), you may have to wait up to six years before you can apply for a mortgage.

If you do take out a mortgage from a specialist lender and meet the repayments, your credit rating might start to repair over time. And once your credit rating has recovered, you may be able to remortgage to a better deal.

A broker could help you navigate the different options – our partner London & Country Mortgages Ltd (L&C)** can help if you need to talk things through with an expert.

Remember, you could lose your home if you’re unable to keep up your mortgage payments.

**London & Country Mortgages Ltd (L&C) are a multi-award winning mortgage broker with over 20 years’ experience in helping people secure their perfect mortgage. Advice is provided by L&C, who are authorised and regulated by the Financial Conduct Authority (143002).
L&C are not part of Compare the Market Limited. Compare the Market receive a % of the commission that our partner London & Country earns. All applications are subject to lending and eligibility criteria.

Go to L&C mortgages

Why is it difficult to get a mortgage with bad credit?

Since the credit crunch in 2008, affordability rules brought in by the Bank of England have forced lenders to be more careful when issuing mortgages. These rules mean it’s become more difficult to get a mortgage if you have a bad credit rating.

If you have a history of not paying back money in full or on time, lenders will be more wary about lending to you. That’s especially true given the amount of money borrowed with a mortgage.

Also, there are fewer lenders willing to offer bad credit mortgages, so there’s less competition and less choice available.

How can I get a mortgage with bad credit?

If you’re trying to get a mortgage with bad credit, there’s a few steps you can take to improve your chances:

  • Build up your credit score. It may take a while, but cleaning up your credit history can improve your chances of getting a mortgage. Read our guide to improving your credit score.
  • Ask for help from family. You may be able to secure a better deal by enlisting a trusted friend or family member to act as a guarantor on your mortgage.
  • If you’re buying a home with a partner, consider their credit history too. If they’re in debt or have adverse credit, see what steps you can take together to improve their financial situation before you buy.
  • Explain bad credit. Lenders are more likely to forgive a black mark on your credit history if you have a reasonable explanation and can show the steps you’re taking to improve your financial situation. You can add notes of correction to your credit file for lenders to see.
  • Don’t be high risk. Prove to your potential lender that you can afford to pay them back. Make sure you have a stable income when you apply and take some time to get your finances in order.
  • Consider a cheaper property. It may mean accepting less than your dream house, but it could be the difference between getting accepted for a mortgage or not, especially if it means you’re able to offer a higher deposit.
  • Save up for a bigger deposit. The more you can pay as a deposit, the more likely you are to be accepted for a mortgage. If your family is willing to help, they may be able to gift you the money for a larger deposit.
  • Be honest. You’re asking for a lot of money, so any potential mortgage providers will be thorough when they conduct their searches. If you withhold information, they’ll find out and you’ll look like a very shaky prospect for a loan.
  • Get advice. Speak to a mortgage broker to get an idea of what you’re likely to be accepted for, given your individual circumstances, and what you can do to improve your chances. We’ve partnered with London & Country Mortgages Ltd (L&C)** to provide you with fee-free mortgage advice.

The pros and cons of a bad credit mortgage

If you’ve already found the house of your dreams, here are some pros and cons of applying for a bad credit mortgage rather than waiting to improve your credit score.


  • There are deals out there – shopping around and comparing mortgages is one of the best ways to find a deal to suit your situation.
  • You’ll get on the property ladder sooner.
  • If the market is slow, you’ll have a better chance of negotiating a good price for the property you’re after.


  • If you wait to build up your credit score, you’ll have a wider range of ‘normal’ mortgage deals to choose from.
  • You could end up paying higher interest rates if your credit score is still poor.
  • Lenders may only consider your application if you have a decent deposit to put down.

If you do decide to go ahead with a bad credit mortgage, you may be able to remortgage to get a more favourable deal once your finances are under control and your credit rating has improved.

Can I remortgage with bad credit?

Getting a new deal with your current lender might be a good option if you have a bad credit record as you won’t be subject to any further credit checks – provided you’ve kept up with your mortgage repayments and you’re moving to a like-for-like deal. In other words, you’re switching your existing mortgage arrangement to a new rate, but without any changes to the outstanding balance, term or repayment method.

If you’re considering switching to a new lender, they’ll apply the same approach to remortgaging as they do to lending for new mortgages. This means interest rates could be higher or lower, and the amounts you can borrow may be higher or lower.

Potential new lenders will take a long, hard look at what you can and can’t afford, especially if you’re asking to borrow even more money.

If you’re looking to remortgage with bad credit, speak to an advisor at our partners London & Country Mortgages Ltd (L&C)**. They can check your eligibility with a variety of different lenders who’ll remortgage to homeowners with bad credit.

Why do I have a poor credit history?

There’s a number of reasons why you might have a poor credit rating – also known as adverse credit.

Typically, a common reason is missing credit card, loan, mortgage or even gas or electricity payments. So if you fail to pay back a loan completely, you’re in mortgage arrears or you missed payments on your phone contract or utility bill, your ability to borrow money in the future could be affected as you look unreliable. Even paying bills a few days late will be noted on your credit file and can impact your credit rating, although on its own it’s unlikely to stop you from getting a mortgage.

Being declared bankrupt or being subject to an Individual Voluntary Arrangement (IVA) or County Court Judgement (CCJ) will also negatively affect your credit rating. Having a previous property repossessed will also make lenders look very carefully at your application too.

Having adverse credit doesn’t necessarily mean you’ve been financially irresponsible in the past, it could also refer to a lack of credit history. That could be the case if you’ve recently moved to the UK or if you’ve never held a bank account, credit card or registered to vote. Other factors like not being on the electoral roll can also negatively affect your credit score.

How can I check and improve my credit score?

If you’re looking for a mortgage, it’s worth checking your credit history at Equifax, Experian and TransUnion, as different lenders use different credit-checking agencies.

First, you’ll want to check everything on your credit file is correct and flag anything you don’t recognise. Then, if you do have adverse credit, you can work on building up your credit score. You’ll have to be patient, though, as it can take months to see any improvements in your score.

Read our guide to building your credit score.

Bad credit mortgages for first time buyers

For young people who are looking to borrow for the first time, having no credit history can be similar to having a poor credit rating. That’s because lenders are looking for customers who have shown they can successfully manage credit. 

If you’re thinking of getting a mortgage and you have little or no credit history, you may want to think of manageable ways of building your credit. That might be taking out a phone contract or having utility bills put in your name. Paying these on time can help build up your credit history. Another way to build credit might be through a credit-building credit card.

It’s not impossible for first-time buyers with no credit history to get a mortgage. Although it can limit your choice of mortgage deals, lenders won’t consider your situation as serious as, say, someone with a CCJ.

It might be worth considering the government’s mortgage guarantee scheme, which aims to make mortgages on homes costing up to £600,000 available to those with just a 5% deposit. It’s open to first-time buyers, as well as people who already own their own homes. Most high-street banks have signed up to the scheme.

Bad credit mortgages for home movers?

If you have a bad credit history and you’re moving home, check whether your current mortgage deal is portable and if your provider will consider further lending. You could also ask a mortgage broker whether it’s worthwhile considering a different lender, based on your current credit history.

You might still decide, however, that it’s better to wait until your credit history has improved, as this could give you access to more affordable deals. Alternatively, you could take action to improve your credit rating at the same time as saving for a deposit, once you have a rough idea of how much you can afford to borrow with a mortgage. 

If you’ve fallen in love with another property, make sure you’re certain about how much you can afford to pay if your mortgage deal is likely to be more expensive. And don’t forget to take into account the additional costs, like stamp duty, legal fees and moving costs.

Avoid making multiple mortgage applications, though, as you could potentially damage your credit score even further.

What is the lowest credit score you can have and get a mortgage?

There isn’t an absolute minimum credit score you can have and still get a mortgage because, ultimately, it’s up to the lender. Some mortgage providers will only consider applicants with a ‘good’ or ‘excellent’ credit history, while others specialise in poor credit mortgages.

Also, mortgage providers are required by law to look carefully into whether you’re able to afford your mortgage payments. That means weighing up your income and expenses alongside your credit history, the value of the property you want to buy and the size of the loan. This may mean fewer options are available to you.

If you’re worried about adverse credit affecting your mortgage chances, it’s a good idea to speak to a mortgage advisor. They can explain your options and help you search for suitable mortgage deals.

What do I need to compare bad credit mortgages?

To compare bad credit mortgages, you’ll need to have the following information:

  • Details of your salary and any other income
  • If you’re buying with someone else, details of their income
  • Whether you’re going to live in the property or let it out
  • If the property will be a new build or new conversion, and if it will be freehold or leasehold
  • If you’re a first-time buyer
  • How much you want to borrow and what your deposit will be
  • If you’re getting help from a Government scheme to buy your home
  • Details of outgoings for affordability checks.

A copy of your full credit report will be useful, either for your own use or to help a mortgage advisor check which lending criteria you meet. Check your credit score.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Why use Compare the Market? 

We compare deals from leading mortgage providers and make it easy for you to find and compare bad credit mortgages. We also work with one of the UK’s leading mortgage advisers London & Country Mortgages Ltd (L&C)**.

Author image Alex Hasty

What our expert says...

“Don’t despair. If you have bad credit it’s still possible to find a mortgage. And if you can manage your money well and improve your credit rating, you’ll have greater choice.”

- Alex Hasty, Insurance comparison and finance expert

Frequently asked questions

How long does history of bad credit stay on my credit file?

Credit issues stay on your credit file for six years. Mortgage lenders typically use this as a time frame to check out your current financial situation.

But even if you have recent credit issues that show up on your file, it may still be possible to get a bad credit mortgage, depending on the severity of the issue.

What’s the difference between bad credit and no credit history?

A bad credit history is when you have records of missed or late payments, multiple credit applications and more serious issues on your credit file like an Individual Voluntary Arrangement (IVA), bankruptcy or CCJ.

No or a low credit history means you haven’t built up a credit score to show you can borrow responsibly. For example, if you’ve never had a credit card, overdraft or taken out a loan, lenders won’t be able to see that you can manage your finances in a sensible way.

Can I get a joint bad credit mortgage if my partner has a good credit history?

Yes, it’s possible to get a bad credit mortgage if one of you has a better credit history. Lenders will consider both of your finances and credit histories, so one may offset the other. This could mean you get a better interest rate thanks to your partner’s good credit rating.

If you’re looking for a joint mortgage and one of you has bad credit, it might be worth using a specialist mortgage broker. They can talk you through your options and help you find the best bad credit mortgage for your situation.

How much deposit do I need for a bad credit mortgage?

You’re likely to need between 10-25% deposit, depending on how bad your credit history is and the lender’s preferences. For example, you might get a specialist bad credit mortgage with a 25% deposit after repossession, bankruptcy or an IVA payment plan has been completed – although you might need to wait up to six years before a lender will consider your application. Those with minor credit issues might even be able to get a 90% mortgage, as long as they meet the lender’s other eligibility requirements.

The larger your deposit, the better your chance of being approved for a bad credit mortgage. See more about LTV (loan to value) – the amount of mortgage you can get against the value of the property you’re buying.

The content written in this article is for information purposes only and should not be taken as financial advice. If you require support on the products discussed here, please speak to your bank/lender or seek the advice of an independent professional financial advisor. We also have more information on our Customer Support Hub.

Looking for a mortgage?

Compare mortgages in minutes to see if you can save

Compare now

Alex Hasty - Insurance comparison and finance expert

At Compare the Market, Alex has had roles as Commercial Associate Director, Director of Trading and Director of Growth. He’s currently responsible for the development and execution of Comparethemarket’s longer-term strategic options, ensuring the right breadth of products and services that meet customer needs.

Learn more about Alex

Compare mortgages in minutes to see if you can save Start comparing