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Can I get a mortgage with a low credit score?

Is your credit score lower than you’d like it to be? Perhaps you’ve got a default, CCJ or IVA lingering on your credit report, and are worried that you won’t be able to get a mortgage until it’s been wiped clear?
Low credit score

See if you pre-qualify for a mortgage

Enquire about a mortgage with our pre-qualifying affordability form. No imprint on your credit score.

Will not affect credit score

Is your credit score lower than you’d like it to be? Perhaps you’ve got a default, CCJ or IVA lingering on your credit report, and are worried that you won’t be able to get a mortgage until it’s been wiped clear? Perhaps you’ve not had any or much credit in the past and therefore are showing a low score?

Don’t worry. Finding a mortgage to purchase a new home or remortgage your current home, with a low credit score isn’t just possible, it’s also quite straightforward – all you need to do is find the right lender.

Getting a mortgage with a low credit score

When looking for a mortgage, your first instinct is probably go to the more popular lenders, such as the big high-street banks. Whilst those lenders might offer a mortgage to someone with a low credit score, you may find you don’t quite make the mark, as their ‘low’ is not quite as low as needed.

This doesn’t mean you can’t still get a mortgage and find a good deal though.

By working with a broker, you can access a range of great mortgage options that have been designed specifically for people with a low credit score (and even a bad credit score). These are more specialists lenders who often work exclusively with mortgage brokers to give people who don’t have the best credit scores the chance to own their own home or remortgage the current one.

The rates offered by these lenders aren’t always as good as the ones you could get with a high credit score, of course. But what low credit score lenders do offer are fair, affordable and good value mortgage rates that allow you to get the property you want now.  These lenders look at your case more individually and are prepared to lend to those with a low credit score.

Will applying for a mortgage harm my credit score?

This depends entirely on who you go to.

It’s true that sometimes applying for any credit, be that a credit card, personal loan or a mortgage can impact your credit score. If you apply for finance and are rejected, this can lower your score, which in turn might make it harder for you to get accepted for mortgages in the future. As you can imagine, this can be very damaging to your credit score if you’re rejected for more than one mortgage.  You start to build a profile of declined lending, which makes other lenders more cautious.

At Clever Mortgages, we like to do things a little differently.

With us, we can help by doing something called a soft credit check. This means that we’ll look at your information and let you know if you’re likely to be accepted for a mortgage before you apply for it.

This not only protects your credit score from being damaged, but also saves you time and effort by removing the mortgages that you aren’t going to be accepted for, and instead only showing you the ones that you could get.

How did I get a low credit score in the first place?

There are generally two reasons for having a low credit score, the first is that you’ve missed payments on credit in the past and this is normally classed as having a poor or bad credit score, which can then lead to a low score.  The other reason is that you’ve not had any or very little credit before and therefore a lender isn’t able to assess the risk of lending to you, as there is no or little proof of you paying a debt back.  Whilst the latter isn’t bad credit, you have a low score.

Its often said that taking out a credit card with a small limit and paying for everyday items like shopping and petrol, then clearing the balance in full will start to build a credit profile. 

We would always urge you to think carefully about taking out a credit card, ensure you get the best rate possible, hopefully 0% interest for a period and then clearing the balance, In FULL, each month.

Will my credit score improve over time?

In short, the answer is yes, if you ensure that you make your debt repayments in full when they are due.  If you take out further credit this can impact your score, but as soon as you start repaying it, it does show a commitment to pay, which is a positive.

If you’ve never had credit before, then you’ll need to show a commitment to pay, by doing as mentioned above with a credit card.

If you’re looking to get a mortgage as you’re reading this, then this presents you with a choice; wait until your credit score has improved enough to get a mortgage from the big high-street lender, or consider using a mortgage broker to get approval now and a good deal whilst you are at it. For many people, waiting before finally applying for a mortgage just isn’t a realistic option, especially if you’ve got a young family or want to move into your first home.

There’s no harm in finding out what options and deals could be out there for you. Remember, with us we can perform a soft credit search for you, allowing you to see what mortgages are available and at what interest rate with no negative effect on your credit score – so why not give Clever a call today and see how we could help you?

To discover a range of fair, affordable mortgage deals today from our trusted panel of lenders, give us a call on 0800 197 0504, or arrange a call back at a time that suits you.

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