Applying for a Mortgage with a Default

Applying for a Mortgage with a Default

Having bad credit or a poor credit history can have an impact on whether you will be successful when applying for a mortgage. Defaults can take place on a number of financial items that are linked to you; from credit cards, store cards, loans and hire store purchase agreements. They can all cause you to suffer when applying for a mortgage. Do not fret, however, as there are lenders in the UK who are willing to accept you when applying for a mortgage with a default.

The Process of Getting a Mortgage with a Default

There are ways in which you can approach applying for a mortgage if you have a default, or a poor credit history, even if most high street lenders reject mortgage applications from those with a default on their credit history. There are always certain considerations that a lender will have to take when assessing you as an individual and the likelihood that you’ll be able to make repayments should they award you a mortgage. Being armed with as much information as possible is the best route to go down in order to be successful in the long run.

Take a Look at Your Credit Files – The best place to start is by finding out exactly what is on your credit file. There are a number of online services you can sign up to in order to discover your credit score, history and further details. You’ll need to include your addresses from the last 6 years. For most lenders, if they discover you have a default within the last two years, it is unlikely that they will accept an application for a mortgage, but every lender is different with the application process a complex one, looking at all sorts of aspects of you as an individual.

Review Your Credit Files – Once you have the information at your disposal you can start to dig in and see where the defaults are, and when from. It will include all the credit accounts that you have, including any credit cards, store cards, personal loans and mobile phone contracts. You’ll be able to view detail relating to default dates and amounts, settlement dates, as well as any CCJs, late payments and bankruptcy information (if applicable). Have everything pertinent ready to go when you speak with your mortgage advisor.

Put Together a Mortgage Application – Once you have everything to hand you can search for different mortgage lenders and discover those that are willing to accept applications for mortgages with a default. There will be different sets of criteria depending on the company you are working with. If you have equity and a deposit, you’ll be able to determine the best option for you and the most likely route for a successful application.

For many of the high street lenders in the UK it is common for them to only accept mortgage applications from those individuals who can demonstrate a clear credit history, but so many of us in the modern age has some sort of default on our credit file. There are lenders out there willing to be a little bit more flexible, so dust yourself down if you’ve already been rejected by a traditional lender, follow the steps above and receive assistance from a responsible lender who can help you gain a mortgage with a default.