Can I buy a house with no deposit and bad credit?

Can I buy a house with no deposit and bad credit?

As we’ve explained elsewhere on the site, anyone applying for a mortgage in the UK will need to demonstrate that they’re capable of maintaining the monthly payments. A mortgage is similar to other types of loan in the sense that your ability to cover the installments and your credit history will have big sway over whether lenders will approve your application. Since mortgages are typically far more substantial than the amount of credit you would achieve from personal loans, an overdraft or credit card, they demand an even more advanced level of proof.

 

This means clearly proving how much you’ve saved, the level of your earnings and a decent credit history. It will often involve a deposit – usually ranging from 5% to 20%. Remember that the task of securing a 100% mortgage with no deposit required is relatively tough, even for consumers who have the benefit of an outstanding credit history. In other words, you should bank on having to provide at least a 5% deposit. If you’re absolutely set on how to get a mortgage with bad credit without any deposit, it’s not strictly impossible, there are some shared ownership lenders who will allow you to have 100% share but you will need some money for lender arrangements fees, the interest rate is higher to reflect the increased risk.

If lenders have nothing solid in the form of a deposit or credit history to indicate how likely you are to fully pay them back, then unfortunately there’s no compelling basis for them to offer the loan. Other factors may influence their final decision, though – such as your income and the actual size of the mortgage. If you’re rejected, then you should attempt to obtain as much information as possible about why your application was refused. If your credit history negatively impacted the decision, then there are a few actions you can take to try to remedy that.

At Mortgage Experts Online, we always say that the paramount areas to handle are making repayments on time, settling all outstanding debts, joining the electoral register (if you haven’t already or you have previously withdrawn from it) and checking that you don’t have an excessive line of credit available. You should also try to avoid making several applications in a short space of time, as this can appear to prospective lenders as a sign of desperation and therefore another indicator of lower credit-worthiness.

Speak to a bad credit mortgage advisor.

There are many lenders available ranging from high street to specialist lenders. Most people go to their own bank, get declined or can’t borrow what they need – just because one lender has declined you, don’t give up.

Our mortgage experts will look at each case before deciding which lender is right for you and your individual circumstances. All the mortgage brokers we work with are whole of market and offer unbiased advice. They will have access to all the specialist lenders to really enhance your chances of achieving the mortgage you need.

The expert brokers we work with have experience in dealing with all aspects of bad credit mortgages and importantly using the whole of the market to access the very best deals available.

To find out how we can help call us on 0300 124 5655 or complete our quick enquiry form to speak to a mortgage expert.

 

 

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