Poor Credit Mortgages

Poor credit mortgages

The term ‘poor credit’ is used to describe a history of failures to keep up with payments on your credit agreements. This reduces your credit score, which is a figure that represents your creditworthiness as a borrower. Having a poor credit history and low credit score makes it more difficult to obtain credit in the future from mainstream lenders, including when you apply for a mortgage.

What causes a poor credit score?

There are a variety of factors that can influence your credit score. This includes:

  • Late or missed payments
  • A charge off
  • Collection accounts
  • Filing for bankruptcy
  • Foreclosures
  • Court judgements

Can you obtain a mortgage with poor credit?

It is possible to obtain a mortgage when you have poor credit, but it may not be from a mainstream lender. There is likely to be higher interest rates and a larger deposit required. This is because having a low credit score means you are a higher risk to the lender.

When you apply for your mortgage, the lenders will check your credit history. They’ll review your income and your outgoings, as well as any savings you have. They are looking at your ability to pay the monthly mortgage payments, both now and if interest rates increase.

How can you improve your credit score and your chance of getting a mortgage?

  • Build your credit history by using a credit card little and often. This shows that you are reliable as you repay the money that you borrow.
  • Keep your credit use low by not using all or more than your allocated credit limit.
  • Rectify any errors that may appear on your credit report. This can include registering on the electoral roll.
  • Avoid making too many credit applications over a short space of time.
  • Pay your bills on time. Late payments suggest poor money management and will make a lender doubtful that you will repay your mortgage payments on time.
  • Review your spending – spend less where you can and try to make sure your monthly outgoings are consistent. Where you spend less, use this to add to your deposit. A higher deposit means more favourable interest rates.
  • Make sure you have a large enough deposit for the property you want to buy. For a poor credit mortgage, this will need to be at least 10% of the property price, and in some cases as high as 25%. The chances are if you apply for a poor credit mortgage with a low deposit, your application will not be successful.

What does my credit history include?

Your credit history will include the details of any accounts you’ve had over the past six years. This will include credit cards, loans, overdrafts, utility bills and any existing mortgages. When you download a credit report, all this information will be available for your lender to view. They will be able to see late payments, missed payments and how this all contributes to your overall credit score.

How can I check my credit score?

We have affiliate website that we use to review your credit, called check my file, this company checks three main credit reference agencies, which the mortgage lenders use to assess your credit profile. Check my file offer a 30-day free trial, after this it’s £14.99 per month, you do need to add your card details, then download the report and make sure you cancel it within 30 days if you don’t want to be charged.

Please click below link

Free agencies also offering credit reports include:

(*Please be aware that by clicking on to the above links you are leaving Your Space Mortgages Bristol’s website. Please note that Your Space Mortgages Bristol is not responsible for the accuracy of the information contained within the linked site(s) accessible from this page. Your Space Mortgages Bristol will receive £12 commission from Check my file if you decide to obtain a credit report from them. )

Once you have obtained a full credit report, our team will be able to assist you with the next steps to obtaining a mortgage and buying your own property. To find out more about our services, give us a call today on 01179 146 596 or get in touch.


3 easy steps to your new mortgage

  1. Fill out our online form, request a call back or call us
  2. One of our advisers contacts you to learn more about your situation
  3. Relax while we find you the right mortgage

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