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Can I Get Guaranteed Mortgage Approval with Bad Credit?

See how expert advice could help secure a mortgage with bad credit

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No impact on credit score

Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: November 10, 2021

Let’s start by getting the bad news about guaranteed approval for bad credit mortgages out of the way first, because guarantees don’t exist in the world of mortgage lending.

Since every lender is different, even someone with squeaky-clean credit doesn’t have the luxury of guarantees when it comes to getting a mortgage loan. Even if you’ve got your mortgage in principle (AIP), things can still go wrong and the lender can change their mind if they don’t like something when making further checks.

With all that said, having a history of adverse credit on your file doesn’t automatically mean you can’t get approved for a mortgage loan. In fact, there are specialist adverse credit lenders who will measure your eligibility for lending fairly and, depending on your circumstances, you could even qualify for ‘standard’ interest rates.

Because getting approval for a bad credit mortgage, while possible, will take time and planning, this article explains how mortgage lender criteria influences your eligibility for a mortgage and how you can position yourself for the best chance of securing a mortgage.

Can I get approval for a mortgage loan if I have bad credit?

Yes, depending on your circumstances, it may be possible to get mortgage approval from a specialist lender.

This will come down to the following factors:

  • How long ago your bad credit events took place; the older your adverse credit, the better
  • Whether the issue is now resolved and how long they have been resolved for
  • The cause of your bad credit; lenders are generally more favourable in the adverse was caused by a life event and the credit report usually reflects this
  • How severe your bad credit issues are; a couple of missed phone bill payments are deemed less serious than bankruptcy or defaults
  • The deposit you have available; size matters because the larger your deposit, the smaller the risk you pose to the lender
  • Your current level of income; if you have a reliable income stream and you can prove you can afford the mortgage repayments, this will help a lender approve your application

How to get approval

To stand the strongest chance of getting a mortgage when you have bad credit on your file, take a systematic approach. If you’re applying for a mortgage when you have bad credit it’s good practice to find out if you’re likely to be accepted before making your application.

Every lender you apply to will do a mortgage credit check and, if they performed what is known as a hard credit search, this will show up on your report for other lenders to see. By being cautious about which lender to apply to, you can save yourself a whole heap of hassle and heartache. And, more importantly, save your credit file from further unnecessary damage.

To increase your chances of getting approved for a mortgage when you have bad credit, your best bet is to seek advice from a specialist bad credit mortgage broker, like those we work with. Taking a holistic view of your bad credit and your current circumstances, they will work to match you with a lender who is best positioned to approve your application.

Get in touch for a free, no-obligation chat and we’ll connect you with a broker who can help you get the ball rolling in the right direction.

Can I get pre-approval?

When you have bad credit, getting pre-approval for a mortgage is relatively unlikely. Pre-approval for a mortgage means a lender has confidence in your application. This will likely require you to have the right level of deposit and an income which easily covers your mortgage repayments.

While it’s unlikely that you’ll easily find a lender willing or able to give you pre-approval, when applying for a mortgage with bad credit on your file, there are things you can do to help you stand a better chance of success…

How to get pre-approval

While mortgage pre-approval with bad credit on your file is unlikely, there are practical things you can do to help improve your chances of getting mortgage approval, including:

  1. Save a larger deposit; a deposit of between 20-30% will mean you’ll have more lenders who might be willing to consider your application.
  2. Ask your family to help; if you’re struggling to save for a deposit, many lenders will accept a gifted deposit from a close family relative. The money must be truly a gift and not a loan.
  3. Use a guarantor; if you can find someone willing to stand as a guarantor, this may be a good option for you. It’s a decision not to be taken lightly as you and your guarantor will end up being financially tied to one another which could impact both your credit ratings. If you default on mortgage payments, your guarantor may be liable.
  4. Get your finances sorted; sometimes it’s wiser to bide your time. Postponing buying a home of your own may be more sensible, allowing you time to save for a better deposit and rebuild your credit rating, therefore making yourself a more attractive proposition to more lenders. Playing the slow game could lead to a more competitive interest rate at a later date.
  5. Apply through a specialist broker; as we have already touched on, a broker who is expert at helping customers with bad credit will be able to assess all your circumstances and advise you about which lenders you might be able to consider applying to based on your finances, the property you want to buy and the kind of mortgage you need.

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Can I get approval for a bad credit mortgage online?

Yes, depending on your circumstances, with the right strategy and approach it can be possible. Most mortgage providers and brokers work online and will accept applications and support documentation via email or secure online portals. These days it is fairly common practice for a borrower to never actually come face-to-face with a lender representative or their mortgage broker.

Most of the specialist experts we work with have the capability to do all their work online and over the phone, get in touch for a chat. There’s no obligation to act on their advice and we don’t charge a penny for this service.

How easy is it to get mortgage approval with bad credit?

How easy you find it to get mortgage approval with bad credit on your file will come down to the type of bad credit on your record and how long ago the issue occurred.

If, for instance, you have a bankruptcy on your file, you won’t even be able to apply for a mortgage until it has been discharged. Most lenders will want to see a period of good financial conduct and otherwise clean credit history during the intervening years before they will consider lending.

While you may be able to find a lender willing to lend to you if you’ve had a property repossessed in the last three years, rates you’ll be charged will almost certainly be high.

As a general rule, if you have a history of bad credit, the longer you have maintained good financial conduct without other problems, the more likely it is you’ll get your mortgage application approved.

. 0-12 Months 1-2 Years Ago 2-3 Years Ago 3-4 Years Ago 4+ Years Ago
Late Payments Yes Yes Yes Yes Yes
Mortgage Arrears Unlikely Possible Yes Yes Yes
CCJs Maybe (with good LTV) Maybe (with good LTV) Yes Yes Yes
Defaults Maybe (if good LTV) Maybe (if good LTV) Maybe (if good LTV) Yes Yes
Debt Management Plan No Yes Yes Yes Yes
IVA Possible Possible Possible Yes Yes
Bankruptcy Unlikely Possible Possible Possible Possible
Repossession Unlikely Possible Possible Yes Yes

While the above data is correct at time of writing (November 2020), it only provides a rough example of what you might be able to expect.

To get accurate, bespoke information relating to your credit issue and other financial circumstances, make an enquiry and speak to one of the expert mortgage brokers we work with.

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We know everyone's circumstances are different, that's why we work with mortgage brokers who are experts in all different mortgage subjects.

Ask us a question and we'll get the best expert to help.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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