Bad credit mortgages in the UK: how to get approved with poor credit
If your credit history is less than perfect, you may assume a mortgage is out of reach. However, obtaining a mortgage with bad credit is often possible. Many individuals with missed payments, defaults, a CCJ, or even a past bankruptcy successfully buy or remortgage homes. While your credit history is important, it rarely prevents you from securing a mortgage on its own.
The lender and their approach often make the difference. High-street banks typically use strict credit scoring, while specialist lenders review your history on a case-by-case basis. A broker familiar with these lenders can match you to one more likely to approve your application, rather than submitting it where it may be declined.
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Can you get a mortgage with bad credit?
Yes, in many cases you can. The process is similar to a standard mortgage application, but typically involves additional checks and often requires a specialist lender rather than a high-street provider. Generally, the more recent or serious the credit issue, the more cautious lenders become, making your deposit and overall financial situation more important.
Lenders do not treat all credit issues equally. For example, a single missed payment two years ago is assessed differently from a recent default or an unsatisfied CCJ. Lenders consider the nature of the issue, when it occurred, whether it has been resolved, and your current financial stability. As a result, individuals with similar credit histories may receive different decisions. A realistic assessment of your own situation is an important first step.
This page focuses on the practical, product side: which lenders help, what deposit and rates to expect, and how to improve your chances. If you’d like a fuller explanation of how bad credit affects a mortgage application, our guide on whether you can get a mortgage with bad credit covers the background in more depth.
What is a bad credit mortgage?
A “bad credit mortgage” is not a separate product. It is a standard mortgage offered by lenders who consider applicants with adverse credit history. The home, deposit, and repayments function as they would with any other mortgage.
The key difference lies in how applications are assessed and which lender you choose. Some lenders only accept applicants with clean credit profiles, while others review your credit history in detail and lend when appropriate. Identifying these flexible lenders is essential for a successful application with bad credit.
Terms such as “adverse credit mortgage” or “sub-prime mortgage” also refer to standard mortgages offered by lenders who accept less-than-perfect credit histories. These mortgages operate in the usual way, with the same protections and remortgaging options.
What counts as bad credit?
“Bad credit” refers to various situations, each with different levels of severity. Lenders focus more on the recency and seriousness of issues than on their mere occurrence. Most adverse markers remain on your credit file for about six years, and their impact typically lessens over time.
| Type of credit issue | What it is | Typical impact on a mortgage |
|---|---|---|
| Missed / late payments | Occasional missed or late credit payments | Low to moderate |
| Defaults | An account the lender has closed as unpaid | Moderate |
| CCJs | A County Court Judgment for an unpaid debt | Moderate to higher |
| IVA | An Individual Voluntary Arrangement to repay debts | Higher |
| Bankruptcy / discharge | Formal insolvency, and the point at which it ends | Higher |
| Repossession | A previous property taken back by a lender | Higher |
| No credit history | A thin file with little borrowing to assess | Moderate |
Two applicants with the same marker can get very different outcomes depending on when it happened, whether it has been settled, and how their finances look now. Recency and severity usually matter more than the label itself.
As a general guide, most adverse markers remain on your credit file for about six years from the date they were recorded, after which they drop off. A settled CCJ or a satisfied default is usually viewed more favourably than one left outstanding, and issues from several years ago carry far less weight than recent ones. This is genuinely reassuring: for many people, time and a few sensible steps move a “difficult” profile into “workable” territory, and a broker can tell you roughly where your history is likely to sit.
Which lenders give mortgages to people with bad credit?
There’s no single list, because lenders take very different positions on adverse credit. Broadly, the market splits into two groups.
High-street lenders typically use automated credit scoring and maintain strict thresholds. While applicants with minor or older issues may be accepted, more recent or serious concerns are often declined without consideration of individual circumstances.
Specialist or adverse-credit lenders use a different approach. They often rely on manual underwriting, where an underwriter reviews the details and context of each case. These lenders are more likely to consider defaults, CCJs, and past insolvency, typically in exchange for a larger deposit or higher interest rate.
This is where a broker adds value. An experienced adviser understands which lenders are suitable for specific credit issues and can direct your application to those most likely to approve it. This approach saves time and helps prevent multiple declined applications, which can negatively affect your credit profile.
It is important to understand why this matters. Each full application typically results in a hard search on your credit file, and multiple searches in a short period can lower your credit score and indicate to lenders that you may have been declined elsewhere. Applying to the right lender initially protects both your credit file and your time. Advisers with experience in these cases can often identify in advance which lenders are realistic options for your situation.
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How much deposit do you need with bad credit?
With adverse credit, lenders usually look for a larger deposit than they would for a clean profile, often in the region of 10% to 25% or more, depending on the lender and the nature of the credit issue. A bigger deposit lowers the lender’s risk, which is exactly what reassures an adverse-credit lender.
There’s a positive side to this. A larger deposit doesn’t just improve your chances, it can also widen the range of lenders willing to consider you and help offset the impact of your credit history. If your deposit is currently small, our low-deposit mortgage page explains the options for buyers with less to put down.
As a simple illustration, someone with a recent default might find few lenders at a 10% deposit, but a noticeably wider choice at 20% or 25%, because the larger deposit reduces the lender’s exposure if anything goes wrong. The exact figures depend on the lender and your circumstances, but the principle is consistent: with adverse credit, a bigger deposit is one of the most effective ways to strengthen an application.
Do bad credit mortgages have higher rates?
Usually, yes. Because the lender is taking on more risk, the interest rate on a bad-credit mortgage tends to be higher than the lowest high-street deals. How much higher depends on your credit history, your deposit, and the lender.
The important point is that this is often temporary rather than permanent. As your credit history improves and adverse markers age, and as you build equity in the property, you may be able to remortgage onto a more competitive rate later. Many people treat a bad-credit mortgage as a stepping stone rather than a long-term arrangement.
It’s also worth weighing the cost of waiting against the cost of borrowing now. A slightly higher rate today may be preferable to renting for another two or three years while you wait for your profile to clear, particularly if house prices or your circumstances are moving in the meantime. There’s no single right answer, and a good adviser will help you compare the realistic options rather than pushing you towards borrowing before you’re ready.
Bad credit mortgages for first-time buyers
Buying your first home with bad credit is realistic, and it’s more common than many first-time buyers expect. The same principles apply: the recency and severity of any issues matter, a larger deposit helps, and a specialist lender is often the right route.
It’s worth getting your credit report and finances in order early, and obtaining an Agreement in Principle before you start viewing, so you have a realistic idea of what you can borrow and can show sellers you’re a serious buyer.
First-time buyers with adverse credit can also still use many of the usual routes to ownership, including help from family with a deposit and, in some cases, government-backed schemes, subject to eligibility. The credit issue narrows the choice of lender rather than shutting off first-time buyer options altogether, and starting with honest advice helps you plan around it.
Self-employed with bad credit
Being self-employed with bad credit can feel like a double hurdle, since lenders are assessing both your income and your credit history. It’s still very achievable. The key is presenting your income clearly and approaching lenders comfortable with both self-employment and adverse credit.
Lenders typically assess self-employed income using your accounts and tax calculations (such as SA302s), usually over the last two to three years. Combine that with an adverse-credit lender’s individual approach, and a workable application often comes together. Our self-employed mortgage service explains how different income types are assessed.
If your income varies year to year, how it’s presented can make a real difference. Some lenders use your most recent year, others an average, and some will consider retained profit in a limited company as well as salary and dividends. Choosing a lender whose approach suits your figures, and who is also comfortable with your credit history, is exactly the kind of match a specialist broker is there to make.
Can you get a bad credit mortgage with no deposit?
It’s only fair to be honest here: combining no deposit with bad credit is very difficult, and lenders rarely approve both together. The extra risk on each side usually means at least a modest deposit is needed.
That doesn’t necessarily leave you stuck. In practice, the realistic routes are to save even a small deposit, often around 5%, or to explore a guarantor or family-supported arrangement where a relative helps secure the mortgage. Our zero-deposit mortgage and low-deposit mortgage pages explain the limited options available and who they tend to suit.
How to improve your chances of approval
The encouraging part of a bad-credit application is how much is within your control. A few practical steps can meaningfully strengthen your position before you apply:
- Check your credit report with the main agencies and correct any errors, since mistakes are more common than people expect.
- Register on the electoral roll at your current address, which helps lenders confirm your identity.
- Reduce existing debts where you can, as lower balances improve how affordable a mortgage looks.
- Avoid multiple credit applications in a short space of time, because each hard search can affect your profile.
- Build a larger deposit, which offsets risk and opens up more lenders.
- Let older issues age, as the impact of most markers fades over time.
- Work with a specialist broker, so your application goes to the right lender first time.
Consistent, incremental improvements often have a greater impact than a single major change, and waiting briefly can sometimes put you in a stronger position. You do not need to resolve everything before seeking advice. An adviser can assess your current situation and recommend which changes are most beneficial before you apply, helping you focus your efforts effectively.
How to get a bad credit mortgage
Approaching a bad-credit application in the right order makes it far less stressful. A typical route looks like this:
- Check your credit report. Know exactly what’s on your file before you apply, so there are no surprises.
- Understand your situation. Identify the type of issue, when it happened, and whether it has been settled, since this drives which lenders will consider you.
- Get advice from a specialist broker. An adviser can tell you early which lenders suit your circumstances and how to present your application well.
- Get an Agreement in Principle. This gives an early indication of how much a suitable lender may lend, subject to a full application.
- Apply to a suitable lender. With the right lender identified, you submit a full application supported by the necessary documents.
Taking advice before you apply is particularly valuable with adverse credit, because one well-matched application is far better than several speculative ones.
Example scenarios
Each case is assessed individually. The following examples illustrate how these applications are typically resolved in practice.
A settled default from three years ago.
After a challenging period, a buyer with a settled default, clean recent history, and a 15% deposit was declined by a high-street bank due to credit score. A specialist lender reviewed the case individually and approved the application, considering the settled status and elapsed time as positive factors.
A first-time buyer with a satisfied CCJ.
Concerned that a paid County Court Judgment would prevent approval, the buyer approached a specialist lender. With the CCJ satisfied, a reasonable deposit, and stable income, the lender was willing to proceed. Securing an Agreement in Principle early gave the buyer confidence to search within a realistic budget.
A discharged bankruptcy, several years on.
An applicant discharged from bankruptcy believed a mortgage was no longer possible. However, several specialist lenders consider applicants after a set period, especially with a larger deposit and a positive financial record since discharge. While options were limited, a viable path remained.
Related products
Adverse credit affects more than standard residential purchases. If your situation is a little different, these related options may be relevant. Each is a specialist area in its own right, so we’ve kept the detail to the dedicated pages:
- Shared ownership with bad credit for buyers using a part-buy, part-rent scheme.
- Buy-to-let with bad credit for landlords with adverse credit.
- Second charge with bad credit for borrowing against a property you already own.
Why use Smart City Mortgages for a bad credit mortgage
Adverse credit is a situation where a broker can make a significant difference. We work with specialist adverse-credit lenders and understand which lenders are comfortable with specific issues, from missed payments to discharged bankruptcy.
We provide an honest assessment of your situation, direct your application to lenders most likely to approve it, and improve your chances by removing guesswork. As an FCA-authorised broker, we explain your options clearly and support you from your initial enquiry to completion.
We will also advise you if now is not the right time to apply. If waiting or taking a few practical steps would strengthen your position, we will recommend that approach rather than placing you in an unsuitable deal. Our goal is to secure a mortgage that fits your circumstances and provide a clear plan to move to a better rate as your credit history improves.
We would be happy to clarify your mortgage options.
Frequently asked questions
Yes, in many cases. The process involves more checks and often a specialist lender, and your deposit and the recency of any issues will affect the outcome.
It includes missed or late payments, defaults, CCJs, IVAs, bankruptcy, and repossession, as well as having little credit history. How recent and how serious the issue is usually matters more than the fact it happened.
Some high-street lenders accept minor, older issues, while specialist adverse-credit lenders consider a wider range using manual underwriting. The right lender depends on your specific circumstances, which is where a broker helps. We don’t recommend applying to lenders at random, as declined applications can make your profile look weaker.
Usually more than for a clean credit profile, often around 10% to 25% or more, depending on the lender and the nature of the credit issue. A larger deposit reduces the lender’s risk, so it can both improve your chances of approval and widen the range of lenders willing to consider you.
Typically yes, reflecting the additional risk. This is often temporary, and you may be able to remortgage onto a better rate once your credit history improves and you’ve built up equity. It can still be worth borrowing now rather than waiting, depending on your circumstances, and an adviser can help you weigh that up.
Yes. First-time buyers with adverse credit can still buy, particularly with a reasonable deposit and the right lender. Getting your credit report and an Agreement in Principle in order early helps.
Yes, though lenders assess both your income and your credit history. Presenting your accounts clearly and approaching adverse-credit lenders comfortable with self-employment is the usual route.
Often yes, depending on how recent it is, whether it has been settled, and your wider circumstances. Specialist lenders are more likely to consider these than high-street banks.
This is very difficult, as no deposit combined with bad credit is rarely approved. Saving even a small deposit, or using a guarantor arrangement, makes an application far more realistic.
Check and correct your credit report, register on the electoral roll, reduce existing debts, avoid multiple applications, build a larger deposit, and consider advice from a specialist broker before applying.
Ready to explore your bad credit mortgage options?
Whatever your credit history, the right advice can help you understand what’s realistic and move forward with confidence. We’ll assess your situation honestly, match you to suitable lenders, and guide you through the process.
