How Renting Affects a Mortgage Application

Find out how renting can affect your mortgage application and how a mortgage broker can help you

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Home Mortgage Affordability How Renting Affects A Mortgage Application
Pete Mugleston

Author: Pete Mugleston

Mortgage Advisor, MD

Jon Nixon

Reviewer: Jon Nixon

Director of Distribution

Updated: March 11, 2024

How we reviewed this article:

Our experts continuously monitor changes in the financial space and work closely with qualified mortgage advisors for factual verification.

March 11, 2024

We’ll look at how renting can impact your ability to get a mortgage, how to secure one as a tenant, and how a broker can help you to maximise your mortgage options.

Are there specific mortgages for renters?

Yes. One mortgage lender is offering an exclusive deal for renters, allowing them to get a mortgage with no deposit, as long as they have a 12-month history of making rent payments on time and clean credit.

You can read more about this deal in our guide to no-deposit mortgages.

Aside from this exclusive deal, renters technically have access to all of the same mortgage deals as anyone else, including guarantor and family springboard mortgages for those who will struggle to save a deposit.

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How does renting affect a mortgage application?

Many people rent for a period of time before buying their first home, whether that’s to allow them time to save up a deposit, or as an opportunity to live with a partner before committing to a long-term home together.

Lenders understand this and assuming you would give up your rental property when you buy a home, the rent won’t need to be considered when the lender calculates your affordability, meaning there will be no negative impact on your mortgage application.

The only time renting might prove detrimental to a mortgage application is if you are in rent arrears. In this situation, it is still possible to get a mortgage, but you may need to put down extra deposit and find a specialist lender (which a broker can help you with).

As much as renting won’t negatively impact your application, however, there is no hard and fast rule to say that it will directly benefit your application either. Most lenders won’t take your ability to pay x amount of rent as proof that you can afford to pay x amount of mortgage, and there are a number of reasons for that.

Rent payments vs mortgage payments

It’s not uncommon for rent payments to be the same – or higher – than what the actual mortgage repayments would be, with a standard deposit, for the property being rented out. This leads many applicants to, understandably, argue that if they can afford the monthly rent, they can also afford an equivalent mortgage.

Whilst in some cases this may well be true, mortgage lenders have to assess the affordability of home ownership more extensively than purely your ability to meet the mortgage repayments.

There is far more focus on your income than what you’re currently paying in rent, and lenders are bound by the FCA (Financial Conduct Authority) to ensure applicants would still be able to afford the repayments following an interest rate rise of up to 3%.

They also need to consider the additional costs of owning a home, such as maintenance, building insurance, and possibly ground rent. It’s also quite different judging your ongoing affordability over a few months or years of renting, compared to a typical mortgage length of 25 years.


Although the amount you pay in rent won’t have a direct impact on the lender’s decision, lenders will look at your wider financial picture to establish how you’ve managed your existing outgoings on your current household income, which may put you in better stead than someone who has never had to manage a budget.

The typical loan size offered is around 4.5 times your income, and it’s worth considering that a joint mortgage would more than likely allow you to borrow more, so long as both applicants have an income.

Whilst high street lenders tend to favour the stability of employment, it’s perfectly possible to get a mortgage if you’re self-employed, you may just need a more specialist lender.

How to get a mortgage as a tenant

Your first step should be to find a specialist mortgage broker with experience in this area as this will boost your chances of getting approved at the best terms available.

Using our free broker-matching service you can speak straight away to the right broker by simply making an enquiry online.

They’ll be able to help with:

  • Submitting all of the necessary paperwork: You will need three months’ bank statements, proof of ID, address history, rental payment history (if applicable) and other documents. Your broker will make sure all of this is collated correctly while overseeing your application.
  • Downloading your credit reports: You can do this yourself by accessing a free credit report, but with the support of a mortgage broker, you can optimise your credit files and get them in the best possible shape.
  • Finding the right lender and securing the best deal for you: A broker who specialises in mortgages for renters can compare deals such as the no-deposit option that launched in 2023, guarantor options and specialist lenders to help you choose the most suitable deal for you.

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Eligibility criteria

The eligibility criteria is no different than it is for anyone else, although your commitments as a renter might make it more difficult to meet some of the requirements, such as saving up a large enough deposit.

That said, having lived in rental accommodation can potentially make you more eligible in other respects.


In recognition of the difficulty experienced in saving a large enough deposit in the current climate, there are a range of options on the market aimed at helping first-time buyers with little to no deposit, to get onto the property ladder.

Many lenders offer an LTV (Loan to Value) of 95%, meaning only a 5% deposit is required, and one lender even has a mortgage available at as little as a 2% deposit.

This is aimed specifically at first-time buyers who cannot rely on financial help through family-assisted products, such as the joint borrower sole proprietor mortgage or guarantor mortgages.

Credit Score

If you’ve lived in rental accommodation for some time, the likelihood is, that you’ll have a more extensive credit history than someone who’s only lived with their parents, as you will have had utilities in your name, and these are generally recorded on your credit record.

If you’ve had credit cards or loans that have been repaid in a timely manner, this can also help with your credit score.

If you do have a low score, a broker will be able to advise you of the best ways to improve this, and if you have bad credit, it may still be possible to get a specialist bad credit mortgage.


Some mortgage lenders impose age limits on applicants and won’t offer finance to anyone over the age of 75. Other mortgage providers will stretch to higher than this, and a minority have no upper age restrictions at all.

Property type

Properties with non-standard construction elements, such as thatched roofs, steel frames and other unusual features, can be more difficult to get a mortgage on and may call for a specialist lender.

Can you pay rent and a mortgage at the same time?

There are circumstances where you can pay both rent and mortgage repayments at the same time. The Shared Ownership scheme is built upon this premise, so it’s certainly not unheard of. That said, it will depend on your overall affordability if you wish to rent a property and buy another one simultaneously.

If you’re purchasing a residential property, you are expected to live in that property, so there are not many lenders that would be willing to lend to you to buy a residential home if you plan to live in separate rental accommodation.

There may be extenuating circumstances, but this is not something that you would be able to achieve without the guidance of an experienced broker.

Buy-to-let as a pathway to homeownership

There is a growing trend for first-time buyers, especially those in high-cost areas such as London, to use a buy-to-let property to get onto the property ladder. They continue renting in London, for example, but purchase a buy-to-let property further north, where the housing prices are generally lower.

Although this offers a great opportunity for some, it’s important to bear in mind that you’ll need to declare your rent as an outgoing, and this will substantially reduce your affordability in most cases.

If you are in a position to do this, there are far fewer lenders available that are prepared to offer buy-to-let mortgages to first-time buyers, so it’s crucial to speak to a broker.

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Do rental arrears affect your mortgage application?

As rental payments are not automatically recorded on your credit record, this is fairly unlikely, but in certain circumstances, it may have an impact.

This includes:

If you have a CCJ

Whilst missed payments won’t appear on your credit file initially, if you continue to miss payments, your landlord could file your debt with the courts in the form of a CCJ (County Court Judgement).

CCJs will always appear on your credit record, and will certainly have an impact on your mortgage application.

If you are part of the Rental Exchange Scheme (RES)

The RES is not a mandatory program, but it allows private tenants to boost their credit scores by having their rental payments voluntarily recorded on their credit record.

Whilst the amount of rent that you pay won’t sway your application, a record proving that you’re able to meet your financial responsibilities, and therefore, a better credit score, can certainly improve your application.

The scheme was created by Experian in 2016 and uses an intermediary company, ‘Credit Ladder’, between you and your landlord to receive your rent. They then pass proof of your timely payments to Experian, who will reflect this information on your credit file.

Although this scheme could be beneficial to many people looking to build their credit score, it’s important to consider that it also has the potential to damage your score, if you miss payments or make them later than agreed. This is an especially important factor to consider if you’re in receipt of benefits, such as Universal Credit, which is notorious for delays.

Get matched with an expert broker familiar with the rental market

Whether you’re a first-time buyer or not, it can be difficult to move out of renting into home ownership in the current financial climate.

There are many benefits to using a whole-of-market mortgage broker to help you secure the right deal, but a broker with specific experience in helping those struck in a rental rut to find a workable solution will provide you with the most relevant advice.

Our free broker matching service takes all of your needs into consideration before recommending the ideal broker for you, meaning that you have the best chance of securing the home loan you need.

What’s more, our service is absolutely free of charge, and you are under no obligation to take things any further.

Simply get in touch today on 0808 189 2301 or make an enquiry, and let us know exactly what you need, and we’ll put you in touch with an expert who can help you to achieve your homeownership goals.

Maximise your chance of approval with a dedicated specialist mortgage broker

Get Started Phone Icon 0808 189 2301


It’s possible to use the income from an existing rental property towards another mortgage, however, the availability of lenders who will approve this depends on the type of purchase.

Most lenders will be happy to use this form of income to support another buy-to-let purchase to expand your portfolio, although very few will accept it for a residential purchase. For more information, check out our guide on using rental income to qualify for a mortgage.

Not typically as landlords are not classed as creditors and therefore do not need to report your rental payments to the credit reference agencies.

You can, however, sign up for rent reporting they’ll act as a middleman if you want your rental payments to be reported to the credit reference agencies.

Rental payments can only negatively impact your credit files if you miss them, make a late payment, or are in rent arrears.

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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 Online Mortgage Advisor of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

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