Can You Get a Mortgage With Bad Credit? These 5 Tips Can Help

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Not everyone has good credit, and a poor credit history shouldn’t be a barrier to getting a mortgage. Bad decisions in your past or credit issues due to financial difficulties can stick with you for many years. And if your aim is to get a mortgage, this likely won’t work in your favour. 

However, just because you have poor credit, it doesn’t mean you won’t get a mortgage. It just means you need to work a little bit harder before you are in an excellent position to be accepted for more preferable deals. 

If your credit history is less than perfect, tips can help you boost your chances of a successful application. 

Talk to a Broker 

A mortgage broker can work with you to help you uncover your eligibility and what you need to do to overcome past indiscretions with your finances. It might not seem this way, but using a broker can increase your options as they better understand what lenders are looking for and what criteria you need to meet to secure your mortgage with bad credit. 

Make Payments in Time 

A great way to boost your chances of being accepted for a mortgage is to ensure you are able to meet your current financial obligations and make all required payments on time. This means your utilities, credit cards, bills, loans, council tax, etc. The more you can prove you are able to pay on time consistently, the better your chances of success will be. 

Check Your Credit Score 

Your credit score shouldn’t be overlooked, as this is an important factor concerning your eligibility for a mortgage. Where possible, contact creditors to remove any mistakes and update your information. Get any errors rectified and look at adding a note, if applicable, to cover any periods you can explain, such as missing payments due to being made redundant or ill health, for example. If you’ve always made payments on time but for a short period where you were sick, which caused you to miss payments, you can ask to add a note of correction to address this. 

Be Realistic About What You Can Afford 

While you might theoretically be eligible to apply for a higher mortgage, it is better to err on the side of caution and opt for a smaller loan to improve your chances of being approved. Alternatively, you can save for a bigger deposit, so you’re not requesting to lend as much. 

Have a More Substantial Deposit 

Following up on the above point, a larger deposit will work in your favour when it comes to your mortgage application. If you have bad credit, you might not be eligible for mortgages with a 5% or even 10% deposit, depending on your circumstances. The more money you can put down to support your application, the better your chances of being approved will be. 

Getting a mortgage with bad credit isn’t impossible. However, you do need to be careful about how you approach the process, take your time to do everything you can to boost your credit score, and know your options before proceeding. 

This is a collaborative post.