Adverse Credit Mortgages with CCJ’s
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Mortgage with CCJs – how to find one
When you have a low credit score it’s often harder to get a mortgage – but not impossible. In fact, some lenders specialise in adverse credit mortgages, so even if you have serious credit issues you could still buy a home. A County Court Judgement (CCJ) on your record is fairly severe, so let Spot On Mortgages help you explore the options.
What is a CCJ (County Court Judgement)?
A County Court Judgment (CCJ) is a court order issued against someone who fails to repay money they owe. They’re not unexpected – you will receive written warnings before the County Court claim form comes in the post.
The CCJ is cancelled if you pay back the debt within 30 days, but if not, it is added to your record and will instantly give you an adverse credit rating. This will make it difficult for you to borrow money or get any kind of finance deal, especially with a high street lender.
Can I still get a mortgage if I have a CCJ?
The first step in finding a mortgage with a CCJ is to fully settle the debt. It will also help to wait until the CCJ is a few years in the past, especially if you’ve kept your record clean since.
The easiest way to obtain a mortgage when you have adverse credit is with a large cash deposit. If you have a deposit worth 25% of the property value – or more – your credit report is less important to the lender.
A further option to consider is getting a joint mortgage with someone who has a good credit history.
Do the details of a CCJ matter for a mortgage?
The size and the date of your CCJ are important. If you received the judgement in the past year or so, it will be harder to get mortgage approval. The CCJ will disappear from your file after six years, so if this date is close it may be worth waiting to apply for a mortgage. You will almost certainly get a more competitive mortgage deal with a clean record.
Unsurprisingly, the size of the debt is relevant too. A CCJ of more than £1,000 in the past 12 months seems a big risk to a lender, while a settled debt of a hundred pounds from a few years ago may not be a big concern.
How much will I be able to borrow on an adverse credit mortgage?
The amount you can borrow will depend on your annual income, your outgoings, the size of your deposit and the lender’s criteria.
Each lender will have different rates, fees and requirements, so it’s important to compare all the available options before making a decision. What’s essential is that the repayments on your mortgage are comfortably affordable – if you fall behind, you risk losing your home.
How can I rebuild my credit score after receiving a CCJ?
There are a number of ways to improve your credit file. First, make sure you are listed on the electoral roll – this is a basic requirement for credit. Check your credit score for errors and correct them if necessary.
Next, you must make every payment on time: on your CCJ and utility bills, for example. If you are in a debt management plan, ensure you follow it perfectly.
Try not to apply for new finance deals – every application will show on your record, and lenders will see lots of applications in a short time as risky.
Can a Mortgage Broker help if I have had a CCJ?
Mortgage Brokers like Spot On Mortgages are experts in the mortgage sector. We work with all kinds of mortgage clients: from First Time Buyers and home movers, to those looking for Buy to Let mortgages and people with adverse credit.
We’re here to make it easier to buy a home, by exploring your specific situation and property plans. We work through the whole process with you, finding the lenders most likely to accept you, exploring your deposit options and comparing the various mortgage rates and fees. Once you have made your choice, we’ll help you with the mortgage application and support you at each step towards owning your own home.
We’re registered in England & Wales and our Principal is authorised by the Financial Conduct Authority. Contact our registered office today for an initial chat about how we can help you.
A mortgage is a loan secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
Why Spot On Mortgages to this?
Other types of mortgages are available such as Variable, Cashback, Capped, Collared & LIBOR.