Bad Credit Mortgages Chesterfield
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Bad Credit Mortgages
Having a history of missed payments, defaults, a County Court Judgment or other credit problems doesn’t necessarily mean you can’t get a mortgage. However, your options can depend on the type of credit issue, how recent it was and your wider financial circumstances.
As a mortgage broker in Chesterfield, we can help you understand how your credit history may affect your mortgage options and look at lenders whose criteria are appropriate for your circumstances.
Can I Get a Mortgage With Bad Credit?
Yes, it can be possible to get a mortgage with bad credit. Lenders don’t all assess credit history in the same way, so an application that doesn’t fit one lender’s criteria may be acceptable to another.
The important thing is understanding your circumstances before making an application. The type of credit issue, the amount involved, when it happened and whether it has been settled can all affect the lenders available to you.
What Counts as Bad Credit?
Bad credit can cover a range of different circumstances. You may have a history of missed or late payments, defaults, County Court Judgments (CCJs), an Individual Voluntary Arrangement (IVA) or even a previous mortgage or loan application that was declined.
Having one of these on your credit history doesn’t automatically rule you out of getting a mortgage. Lenders have different criteria and will consider your circumstances as a whole.
Mortgages After a CCJ
A County Court Judgment can make getting a mortgage more difficult, particularly if it is recent or remains unpaid. However, some lenders will consider applicants with a CCJ depending on the circumstances.
The age of the CCJ, the amount involved and whether it has been satisfied can all be relevant when assessing your application.
Bad Credit Mortgage Advice in Chesterfield
There isn’t a single definition of a bad credit mortgage. What one lender considers unacceptable may be acceptable to another, depending on the circumstances.
We’ll look at your credit history, income, deposit and wider financial circumstances before discussing the mortgage options that may be available to you.
Speak to The Mortgage Store Chesterfield
If you’re worried that your credit history could prevent you from getting a mortgage, get in touch for an initial conversation. We’ll look at your circumstances and explain your options without making assumptions based solely on your credit score.
Your property may be repossessed if you do not keep up with your mortgage repayments.
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Mortgages for Sole Traders
If you’re a sole trader, lenders will generally look at the income generated through your business when assessing affordability.
Your accounts and tax documentation can be used to demonstrate your earnings, with lenders having different requirements around the number of years of trading history they want to see.
If you’ve been self-employed for a relatively short period, don’t automatically assume that you won’t qualify for a mortgage. Some lenders have criteria for applicants with less trading history than others.
Mortgages for Limited Company Directors
Limited company directors can sometimes find mortgage applications more complicated because your personal income may not tell the full story of how much your business earns.
Depending on the lender, your income could include your salary and dividends, while some lenders may also consider your share of the company’s retained profits.
This can make a significant difference to how much you may be able to borrow, particularly if you keep profits within your company rather than taking them as personal income.
Not every lender treats company directors in the same way, which is why choosing the right lender before submitting an application can be important.
Self-Employed Mortgages With One or Two Years’ Accounts
Many people assume that you need three years of accounts before you can apply for a mortgage. This isn’t necessarily the case.
Some lenders will consider applicants with one or two years of trading history, although their criteria can vary depending on the nature of the business, income and circumstances.
If you’re newly self-employed or have recently started trading through a limited company, we’ll look at your situation and explain which options may be available.
Bad Credit Mortgage FAQs
1Can I Get a Mortgage With Defaults?
Defaults can affect your mortgage options, but they don't necessarily prevent you from obtaining a mortgage.
Lenders may look at how many defaults you have, the amounts involved, when they were registered and whether they have been settled. More recent or significant defaults can reduce the number of lenders available, while older credit issues may have less impact.
2Can I Get a Mortgage With Missed Payments?
Missed payments are another factor lenders may consider when reviewing your credit history. The impact can depend on how recent the missed payments were, how many there were and which accounts were affected.
If your financial circumstances have since improved, there may still be mortgage options available. We'll look at your current position alongside your previous credit history when considering suitable lenders.
3Can I Get a Mortgage After an IVA?
It can be possible to obtain a mortgage after an Individual Voluntary Arrangement, although the number of available lenders may be more limited.
Lenders can have specific requirements around how long ago the IVA was completed, your current financial position and your credit history since the IVA. Specialist lenders may have different criteria from mainstream banks.
4Does Bad Credit Mean I Need a Bigger Deposit?
Not necessarily, but a larger deposit can sometimes give you access to a wider choice of mortgage lenders and may improve the terms available to you.
The deposit required will depend on your individual circumstances, the severity and age of your credit issues and the lender's criteria.
5Will a Bad Credit Mortgage Have a Higher Interest Rate?
Potentially. Lenders generally take greater risk into account when assessing applicants with adverse credit, and this can affect the mortgage rates available.
However, the rate you are offered will depend on your overall circumstances rather than simply whether you have a bad credit history. As your credit position improves over time, your mortgage options may also change.
6Should I Apply for a Mortgage If I Have Bad Credit?
It's worth understanding your options before making a full mortgage application. Making multiple applications with lenders that don't fit your circumstances can result in unnecessary credit searches and may make the situation more complicated.
Speaking to a mortgage broker first can help you understand which types of lender may be appropriate before an application is submitted.