Can I get a mortgage with a default?

Getting a mortgage with defaults on your credit file is possible. However, where any such mortgage is placed, and under what terms, will depend on the type of account the default was registered against. The amount and date of the registration are also important considerations.

Types of account default

The majority of lenders that consider mortgage applications from individuals with defaults have a hierarchy of default account types they work to ranging from less severe to severe, such as,

  • Mobile phone payment default -- less severe --
  • Utilities payment default
  • Credit card payment default
  • Personal loan payment default
  • Car finance payment default
  • Secured loan payment default
  • Mortgage payment default -- severe --

When default was registered

If the default was registered in the last 12 months this will considerably restrict your options, but mortgage options are certainly probable. You will also be looking at loan to values (LTV's) certainly below 85%, meaning if you considering purchasing a property you would have to fund a deposit in excess of 15% of the property value.

When the default registration date passes 12 months your mortgage options start to increase. Over 24 months old the LTV's required by many lenders start to get closer to 90%.

Once the registration date passes 3 years many lenders will probably ignore the default and offer you fairly competitive mortgage deals.

Amount default was registered for

Rule of thumb, any default registered within 12 months and for over £1500 placing any mortgage becomes more challenging. Once the default registration date passes 12 months things become a little easier and over 3 years a lot easier.

What if the default is unsatisfied

This is not as important as you my think. What is more important is the date of registration. Some lenders, depending on the date of registration may insist on the default being satisfied on completion of the mortgage.

What if you have other bad credit

If you have multiple defaults and/or other bad credit registered on your credit report it is important you get in touch so we can start checking your eligibility for any mortgage application. It is important your application, or next application, is with the best mortgage option to dramatically increase your chances of being approved for a mortgage.

What now?

Simple, get in touch. Before you do you may want to enquire about your credit file as your mortgage adviser will more than likely ask you for it as it will form part of his research in finding your best mortgage choice. As with all mortgages there is no guarantee you will be accepted for mortgage following application but going through Lawrie Mortgages and letting us help you make the best mortgage choice will greatly increase your chances. Any successful mortgage application will rely on your own personal circumstances which will include your income and affordability as assessed by the respective lender underwriting.

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