The simple answer to the question of whether or not you can get a mortgage with a poor credit score is yes.
Even though pretty much all lenders will run a credit check on you prior to approving your application for a mortgage, some negative notes you have against your name will impact your credit score more than others. How long ago those red marks against your name were recorded as well as how much money was involved are both factors which play a major role in determining your credit score.
Examples of some incidents which go down as negative records against your name would include:
- Missed payments – including credit card loans and your mortgage will form part of your credit report for a period of up to seven years
- Any defaults on payments
- Should a third-party collection agency purchase your debt, that will deal some damage to your credit rating (collections)
- Bankruptcy, civil judgements, or tax liens as part of any court judgements can all remain on your credit report for up to 7-10 years, depending on the circumstances surrounding their listing
- The repossession of your home due to defaulting on your mortgage (foreclosure and repossession)
- An account given to you by Consumer Credit Counseling Services (CCCS) may be noted on your credit report
- Credit inquiries about personal loans, credit cards, and mortgages can all remain on your credit report for a period of up to two years, whether or not they’re approved
The reality that you might currently have a low credit rating which has the high street lenders and big banks refusing to lend you the money you need to borrow should not discourage you. Credit scores will generally improve slowly over time, however if you believe that you have a poor credit score, here are some positive steps listed which you can take to improve your score as required:
- It’s very difficult to get credit if you’re not registered to vote, so make sure to register on the electoral roll
- Even the slightest of errors on you listed address can have a negative effect on your credit score, so make sure to check for any mistakes on your file
- Credit linked to that of another person who has a bad score can impact your personal rating, so be cautious about who you’re linked to and be sure to check
- High existing debt-levels will invariably deal some damage to your credit score, so ensure to pay off any existing debt that you can
- Bring forth some stability into your life by staying in one location for as long as you can, as moving house frequently can create a bit of unease amongst some lenders, even if you’d be moving between rental properties
The abovementioned pointers are important to take into account if you’re looking to make use of the services of Mortgage Brokers, as this indicates that they understand the uniqueness of each case and will therefore likely treat your case with the kind of targeted focus it deserves.