First time buyer mortgage bad credit history
- Access to competitive rates and some you can't get direct
- Specialist Mortgage Advisers
- Free initial consultation
What's On This Page?
Your Home (or property) may be repossessed if you do not keep up repayments on your mortgage or any other debts secured on it.
The Financial Conduct Authority does not regulate most Buy to Let Mortgages.
Get In Touch
First time buyer mortgage bad credit history
Jo Evans explains how the mortgage process works if you are a First Time Buyer with a bad credit history.
Can you buy a house with bad credit as a First Time Buyer?
Yes, potentially. It is going to depend on individual situations but hopefully, yes.
Can I get a mortgage as a First Time Buyer if I have a CCJ, IVA, default, with a bankruptcy or if I have a payday loan?
There are a lot of different scenarios in there. County Court Judgements (CCJs) and defaults, are not quite the same, but generally the consensus is that you could get a mortgage with those. There are certain lenders we can approach – although it would depend on the dates when those were issued and if they’d been satisfied or not. We would also need a bit of the reasoning behind why they happened.
With regards to payday loans, again, that’s down to individual lenders, based on when the last payday loan was taken and why. The general consensus is that you should ideally not use them, but occasionally needs must. If you’ve had one in the last 12 months, that will really limit the number of lenders.
IVAs and bankruptcies are different. These really have a big impact on your credit. An IVA is an individual voluntary arrangement, where you go through a third party who arranges for payments to be made to your lenders. They could result in CCJ’s, defaults and inability to get access to credit for up to six years.
Most lenders wouldn’t look at anything until you’ve been discharged from those bankruptcies or IVAs. A lot of lenders want you to be at least three to six years clear since discharge. Again, it is going to be down to individual lenders and providers, but it’s still worth exploring.
Do First Time Buyers need a credit score? Can I get a mortgage if my credit score is very poor?
Yes, everybody has a credit score, even if it’s poor or super high. You do need a credit score.
If it’s very poor, there are again lenders out there, but it will vary depending on your circumstances. A CCJ, default, missed or late payments would influence which lender we could go to. It also depends on when the issue was. The more recent they are, the more restrictions you will have with lenders.
A lot of lenders would want to know the reason behind it. If something’s happened due to a life event, such as a bereavement or a redundancy, that bit of background would help.
What is the most suitable home loan for a First Time Buyer with bad credit?
It’s tailored to the individual and down to the client’s preferences. What is the First Time Buyer’s situation? Are they employed, self-employed? Have they got children? Are they married? Is it just them?
We’d be looking at the options available based on that and your long-term goals. All of that would determine the right home loan. It’s not a case of one size fits all. Everybody’s got different needs and situations.
Speak To an Expert
Our job is to provide you with the expertise and knowledge to find you the most appropriate solution. Whether you’re investing in property or looking to buy your first home, our mortgage advisers can help.
How much deposit will I need? How much can I borrow if I have bad credit?
Depending on when that credit situation arose, you could be looking at ideally a 15% deposit. Some lenders may go to 10% and possibly even 5% depending on the timing. But as a rule of thumb, I would aim for 15%.
How much they would lend again depends on the circumstances – the amount of income, how many people are applying, if they’ve got children and what their costs are. The borrowing would be tailored to them.
What is the process of applying for a mortgage with bad credit as a First Time Buyer?
There may be a few differences. The lender will probably ask you more questions and may want more evidence such as extra bank statements or extra proof of income. They may want more background as to the situation.
A good broker would go through all of that information and tailor it to the lender. We would speak to the lender on the client’s behalf.
What steps can I take to improve my chances of getting a mortgage with bad credit as a First Time Buyer?
The main thing is to pay everything on time. If you have any arrears outstanding – any missed or late payments – try and bring them up to date. Use any little bit of savings for your deposit. If you can, satisfy any outstanding CCJs or defaults.
But speak to a broker first, because we will look at your credit report, go through it with you and tailor a plan around what’s right for you.
How can a mortgage broker help? Have you got anything else to add?
A mortgage advisor can help by gathering all your information on your circumstances and finances. We then do full research across a comprehensive panel. It’s going to be more the specialist lenders in this kind of situation, but it could be that a high street bank might fit in.
We’ll recommend a mortgage based on your circumstances, your preferences and lender suitability. We pull it all together and hold your hand the whole way through. It can be a worrying time, especially when you’ve got that blip in the background while trying to get on the property ladder.
We will go through everything, but the main step is to get that credit report over to your broker as soon as you start thinking about it. Go through the report with us and you’ll get a good understanding of everything.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
Why Choose Fort Advice Bureau LTD?
- Our experienced Management Team has over 50 year's worth of combined knowledge in the mortgage industry.
- We can quickly assess your needs and compare the most suitable products to find you the most suitable deal.
- With an honest, transparent and consultative approach, we are 100 per cent focused on delivering a first-class service every step of the way.
- We build strong, long-lasting relationships with lenders and are not reliant on a computer-generated response.
Fort Advice Bureau is a directly authorised, independent, Mortgage and Protection brokerage which is simply the best way to operate. We are looking for experienced mortgage and protection advisers across the UK, to become part of our business. You will already be self-employed or looking to become such, no monthly fees, and a competitive flexible package. We are an easy-going and friendly firm which you can confirm by asking any one of our advisers.
Telephone: 01245 203495
Email: FAB@fort-ab.co.uk
