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By Pete Mugleston | Mortgage Advisor

Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 20th November 2020*

Money doesn’t grow on trees and neither do mortgages. Finance to buy a property isn’t always the easiest thing to come by, but if you’ve been told you can’t get it, you’ve come to the right place.

This guide is aimed at people who believe they can’t get a mortgage, from first-time buyers to budding buy-let landlords and everyone in between.

Maybe you’ve been told ‘no’ by a mainstream mortgage lender or firmly believe there’s no way you can qualify for a home loan. Either way, we’re here to help by tackling the queries we hear most often from customers who think they can’t get a mortgage.

We offer a free broker-matching service for people who believe they can’t get a mortgage. If you make an enquiry with us, we’ll pair you with a whole-of-market expert who has the expertise to help someone with your specific needs and circumstances.

We vet and train all of the mortgage brokers in our network personally, so you can rest assured that you’ll get the best bespoke advice.

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I can’t get a mortgage! What can I do?

Make an enquiry with us so we can match you with a whole-of-market mortgage broker. They will be able to help you overcome any hurdles you’re facing on your journey to mortgage success. The advisors we work with help people who have encountered all kinds of issues, and we’ll pair you with the broker who is the best fit for your needs and circumstances, and we won’t charge a penny for the introduction.

The first thing your broker will need to know is why you think you can’t get a mortgage. Some customers we’ve helped have been turned down for finance by a mortgage lender and they wrongly believe this is the end of the line for their homeownership plans. Others assume they have no chance of approval because of things like bad credit, their income type or deposit requirements.

In truth, there’s so much misinformation out there, so it comes as no surprise that many people wrongly believe they can’t get a mortgage. Below we’ve outlined some of the most common reasons why customers assume this and explained why these preconceptions are often false.

Is it true that I can’t get a mortgage with bad credit?

Not necessarily, but it’s easy to see why many people assume their bad credit will stop them from getting a mortgage. Some mortgage lenders, especially high street ones, will turn away customers if they’ve had credit problems, especially severe issues such as a recent bankruptcy or a repossession.

If you’ve been told you can’t get a mortgage because of a bad credit record, the good news is that not all mortgage lenders will feel this way about your creditworthiness.

There are specialist bad credit mortgage providers out there and they have the flexibility to base their lending decision on the age, severity and reason for your credit issue. In other words, they take the circumstances into account instead of giving an outright ‘no’.

Take a look at the table below for a rough idea of your mortgage options based on the specific type of bad credit you have and how long it’s been on your file.

Type of Bad Credit How Long Do I Need to Wait? Notes
Late payments Lenders available after 0-12 months Applies to any number of late payments
Mortgage arrears Lenders available after 0-12 months No more than three late payments would usually be accepted if they’re less than a year old
CCJs Lenders available between 0-2 years if the loan-to-value ratio is good If the issue is older than two years, extra deposit is unlikely to be needed
Defaults Lenders available between 0-2 years if the loan-to-value ratio is good If the issue is older than two three, extra deposit is unlikely to be needed
Debt management plans Lenders available after 1-2 years if your credit report is unaffected Difficult to get a mortgage within the first 0-12 months
IVA Lenders available after 1-2 years with 25% deposit, 2-4 years with 20% deposit, and 4+ years with 10% Difficult to get a mortgage within the first 0-12 months
Repossessions Lenders available between 1-2 years with 25% deposit. Possible to get a mortgage without extra deposit after 3 years Difficult to get a mortgage within the first 0-12 months
Bankruptcy Lenders available between 1-2 years with 25% deposit. At least 15% deposit needed at 2-3 years Difficult to get a mortgage within the first 0-12 months

*The table above is intended to give you a rough idea of bad credit mortgage criteria (last updated in February 2020) and is purely for example purposes. Speak to a broker for up-to-date information and bespoke advice.

Even if you’ve been turned away by a mortgage lender because of your bad credit history, there’s still a chance you could be approved by a specialist mortgage company that is sympathetic to people with a poor credit record next time, but only if you know exactly which lender to approach. This is where the brokers we work with come in.

They know exactly which mortgage providers can help you get a mortgage with bad credit and will make sure you’re introduced to the right lender first time.

I’ve been told I can’t get a mortgage because I’m self-employed. Is that right?

No. It’s very unlikely that a mortgage lender would turn you away purely on the grounds that you’re self-employed. The only potential stumbling block would be if you didn’t have enough proof of income.

Self-employed mortgage applicants would usually need to produce two-to-three years’ worth of accounts to get a mortgage. Those who haven’t been trading long enough to provide this often find they can’t get a mortgage, which is no doubt why some self-employed people believe they’ve hit a dead end.

What people in this boat often don’t realise is that there are specialist mortgage lenders with a firmer understanding of self-employed applicants and their specific needs. These mortgage providers have the flexibility to base a mortgage offer on 12 month’s accounts or less.

See the table below for a handy summary of your self-employed mortgage options based on how many years you’ve been trading for.

Number of Years Trading Amount of Approachable Lenders Notes
3 Years A wide range of lenders, including high street banks and building societies Three years’ plus of accounts is optimum income proof for a self-employed mortgage
2 Years Some lenders will accept Best interest rates might be harder to come by with two years’ accounts compared to three
1 Year A small number of lenders consider customers with one year’s accounts Might be limited to specialist lenders, need clean credit and be asked to put down a larger deposit
Less than 1 year A few specialist lenders A small minority will be happy with 9-12 months’ trading, but year-to-date accounts from a qualified accountant are need and criteria will be strict

*The table above is intended to give you a rough idea of self-employed mortgage criteria (last updated in February 2020) and is purely for example purposes. Speak to a broker for up-to-date information and bespoke advice.

If you have less than two-three-years’ accounts, finding a mortgage lender who’s willing to be flexible isn’t easy, unless you know the market like the back of your hand.

Luckily, the expert brokers we work with have this in-depth knowledge and are able to find the right mortgage lender for you, based on your employment situation and how many years you’ve been trading for.

I can’t get a mortgage because I’m too old

This is almost certainly a misconception because there is no upper age limit that rules you out from getting a mortgage. Well, there’s no limit that applies across the board, at least.

Some mortgage providers won’t lend to anyone over the age of 75 and others stretch to 85, but there are a few who have no upper age restrictions at all. These lenders are more concerned about whether the mortgage will be affordable for the duration of the term. To them, age really is just a number.

If you think you can’t get a mortgage because you’re too old, this might simply be because you approached a lender with strict age limits or read an article that didn’t tell the whole story. Either way, the brokers we work with can help by matching you with a mortgage lender who specialises in later-life mortgages.

I can’t get a mortgage because of issues with the property. What are my options?

You should speak to a mortgage broker to find out exactly what your options are, but first, consider the possibility that you just haven’t found the right lender for a complex deal like this.

We’ve helped many customers who wrongly believe they cannot get a mortgage because of the house type they’re buying. This is occasionally because the property falls into the ‘non-standard construction’ category and they have approached a lender who usually sticks to finance for bricks and mortar homes. Or perhaps, they’ve heard second-hand that non-standard properties are unmortgageable.

Of course, non-standard construction isn’t the only property-related issue that can cause problems. Some lenders are wary of deals where damp has been discovered in the home, Japanese knotweed in the garden or if the building is located in an area with a high risk of flooding.

Forget what you’ve been told, it may be possible to get a mortgage despite these issues, but only if you know which lender to approach. Some mortgage providers have a high appetite for risk and are known to specialise in deals involving unusual build types and properties with issues that need to be addressed.

See our guide to mortgages and property types for more information.

I can’t afford a mortgage or raise enough deposit. Can you help?

Yes, but first keep in mind that you might be wrongly assuming you can’t afford a mortgage or raise enough deposit. There are specialist mortgages for low-income households and lenders who might let you borrow between 5 and 6 times your salary, rather than the industry standard 4.5.

As for mortgage deposit requirements, you might have heard that you can’t get a mortgage with less than 15% deposit or been turned away by a lender because you didn’t have that amount. If you know which mortgage provider to approach, it might be possible to get a mortgage with just 5-10%.

See our guide to mortgage affordability and our low deposit mortgages article for more information.

What if I have a deposit but can’t get a mortgage?

If you have plenty of deposit but still think you can’t get a mortgage, there are steps you can take to improve your prospects and they apply whether you’re self-employed, have bad credit, or are making a straightforward application.

If a lender has told you that you can’t get a mortgage, you should…

  1. Ask them why they reached that decision: Once you know where the problem lies, you can explore whether it can be rectified and seek specific advice about your next move.
  2. Don’t re-apply straight away: Too many applications for credit in a short space of time can put lenders off, and another failed application could result in further damage to your credit report. A better bet would be to speak to a broker and get their advice on when to re-apply.
  3. Pay off any debts you’re in a position to settle: If you have fewer outgoings and less debt to your name the next time you apply, your chances of getting a mortgage might be stronger.
  4. Check your credit reports and optimise them: You can download your credit reports here. Reading them will give you a good idea of what the lender will see when they carry out a mortgage credit check. Be sure to pore over them with a fine-tooth comb and challenge any inaccuracies. Furthermore, check out our guide to repairing and building credit for a mortgage for tips to take on board ahead of your reapplication.
  5. Speak to a mortgage broker: Regardless of why you’ve been told you can’t get a mortgage, speaking to a whole-of-market broker can boost your chances of success when the time comes to reapply. They can advise you on how long to wait, how to strengthen your next application and which lender is the best fit for your needs and circumstances. Remember, the market is vast and going directly to a bank or building society means you’ll only have access to their products and potentially miss out on a better deal available elsewhere.

What if I can’t get a buy-to-let mortgage?

If you’ve been told you can’t get a buy-to-let (BTL) mortgage, the process to follow is exactly the same. First off, ask the lender why they won’t offer you credit and speak to a mortgage broker for advice on getting around the obstacle next time. They can be harder to come by than residential mortgages.

You might have heard you can’t get a buy-to-let mortgage for the following reasons…

  • Not enough deposit:
    Buy-to-let mortgages usually have higher deposit requirements than residential mortgages. You may have been told that you won’t get one with anything less than 25%. Keep in mind, though, that there are lenders who may accept 15% deposit.
  • Haven’t been a property owner for long enough:
    Some buy-to-let mortgage lenders only offer finance to borrowers with prior landlord experience. Others will only offer you an investment mortgage if you’ve been a homeowner for at least 12 months with no missed payments.
  • The investment is not viable:
    Most buy-to-let lenders are more concerned with the viability of the investment than your personal income. You may have been told you can’t get an investment mortgage because the potential rental coverage is lower than 125-145%.
  • Other factors:
    Many of the factors we discussed earlier in this guide, in relation to residential mortgage lending, also apply to buy-to-let. These include bad credit and non-standard property types. Some buy-to-let lenders also have minimum total income requirements of £20,000 to £25,000.

If you’ve been told you can’t get a buy-to-let mortgage for any of the reasons outlined above, don’t panic. The specialist brokers we work with may be able to help by matching you to a lender with lower deposit requirements and a more flexible approach to inexperienced landlords.

What if I can’t get a big enough mortgage?

If a mortgage lender was only willing to offer you a capped loan, rather than the full amount you need to borrow, it might be the case that you could qualify for a bigger mortgage with a different lender.

First off, you may have been told you don’t qualify for the full amount because the lender you approached used a lower-income multiple to work out your borrowing potential. As we mentioned earlier, most UK lenders only go up to 4.5 times your salary, so it may be possible to find another who stretches to 5 or 6 times.

Moreover, it might also be possible to take out a larger mortgage on re-application by spreading the debt out over a longer-term. Although you will likely be paying more overall when the total amount of interest is factored in, you might be able to convince the lender that your monthly payments are affordable.

We’ve already outlined ways to boost your chances of getting a mortgage, and they apply here, namely…

  • Pay off any debts you’re in a position to clear
  • Optimise your credit file
  • Reduce your outgoings where possible
  • Speak to a broker for bespoke advice

What can I do if my buyer cannot get a mortgage?

There isn’t much you can do if the person buying your house can’t get a mortgage, but tell them to give us a call so we can match them with an expert broker. This could boost their chances.

If you’re selling a house and the prospective buyer failing to get a mortgage has caused a chain-break (i.e. you’re unable to raise funds for an onward purchase) there are ways you can bide time until another buyer is found.

For instance, you could take out a bridging loan to provide short-term funds to secure your new home. The eventual sale of your current home could serve as your exit strategy.

Speak to an expert

If you’ve been told you can’t get a mortgage, don’t lose hope. The experts we work with have a solid track record when it comes to helping customers with complex circumstances, including those who’ve been turned down for finance on more than one occasion. Call 0808 189 2301 or make an enquiry online and we’ll match you with the best mortgage broker for your needs and profile, and we won’t charge a penny for the introduction.

Updated: 20th November 2020
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FCA disclaimer

*Based on our research, the content contained in this article is accurate as of 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.