Can You Get a Mortgage With Bad Credit? Your Expert Guide

Getting a mortgage is an important step towards securing a property. For many people, this is a significant financial milestone that comes with a lot of responsibility—and, perhaps, anxiety about eligibility. If you’ve struggled to repay loans in the past or find yourself juggling too many credit cards, you might be wondering if you can get a mortgage with bad credit.

To save you the time and energy of researching, we’ve created our simple guide to help you navigate this question. Whether you’re worried about your credit score, debt history, or having no savings, we’ll help you work out if and how you can apply for a great mortgage.

There’s no absolute rule for what’s considered a ‘poor’ credit score for mortgages. This is because each mortgage lender will make its own assessment of your financial situation, considering aspects such as your income and debt levels. Each mortgage lender may have a different way of defining an eligible or ineligible credit score.

However, having a weak credit score could signal to lenders that you’re unreliable. There are 3 main credit reference agencies (CRAs) that calculate your credit score. The following scores are considered ‘poor’ for each company:

Your credit score can become lower if you miss repayments on a debt (including credit cards), have defaulted on a loan, or have had a County Court Judgement (CCJ)—a court order stating that you must repay a debt.

It may be more challenging to get a mortgage with a bad credit score. This is because a low score can reflect financial decisions and behaviours that are undesirable to lenders, such as not repaying debts on time, having excessive debt, or being declared insolvent.

If you’re not able to raise your credit score, and you want to continue applying for a mortgage, you may need to accept less favourable terms.

A ‘bad’ credit (or ‘adverse’ credit) mortgage is aimed at people with a poor credit score (including first-time buyers). Loans for bad credit usually come with higher interest rates, and you may need to provide a higher deposit to make up for the value of the loan. This is because the bank is taking a risk by lending to you and will want to minimise the losses if you don’t repay, which makes a ‘bad credit’ mortgage more expensive for you overall.

This type of mortgage is no longer as commonly available as it was before the 2008 financial crash, as banks are cautious about lending to those who may struggle to repay.

If you currently have a poor credit score, you might be wondering if it’s game over for getting a mortgage. However, before you panic, it’s worth looking at some of the steps you can take to increase your chances of approval. These include the following:

There are some mortgage options for those who have no deposit saved. They are sometimes referred to as zero deposit mortgages, 100% loan-to-value (LTV) mortgages, or 100% mortgages. Only certain lenders will provide these, as they represent a higher risk.

You’ll need to adhere to some stricter criteria to qualify for one of these—for example, proving that you’ve paid rent or household bills consistently for a long period of time (usually a year).

Another route to a mortgage with no deposit is a guarantor mortgage. This is where another person guarantees your mortgage by putting aside a certain amount of its value (usually 5%-20%) into a linked account. If you miss a mortgage repayment, the lender may deduct the amount from this buffer. Your guarantor could also use their own property as security, but this is risky, as the home could be repossessed if you don’t make your repayments.

If you can pull together a small deposit, you may qualify for shared ownership, which means you’ll take out a smaller mortgage to purchase just part of the property's full value. This may be possible with as little as 5% of the portion of the property value you want to own. In rare cases, you may even be able to find a 100% LTV option, but this will probably only be available through a broker.

There are no official credit score requirements for obtaining a mortgage in the UK, and every CRA has a different scoring system. In 2 out of the 3 main systems, a score of 500 would be considered ‘poor’ and may count against you when the lender looks at your overall finances.

You may be able to obtain a mortgage with a CCJ, but it can be a challenging process. If it’s an older CCJ that has been resolved (you have paid the outstanding debts and the matter is marked as ‘satisfied’), you may have a better chance. The number and size of CCJs can make a difference, too—if you have more than one, and/or your CCJ is for a very large debt, that will count against you. In such cases, you may need to work with a specialist lender.

The lender will likely take your credit score into account when you apply for a remortgage. However, other factors are also taken into consideration, such as whether you’ve consistently made your monthly mortgage repayments on time, which can make remortgaging with a poor credit score possible.