bad credit mortgage London

A bad credit mortgage in London is not necessarily out of reach just because your credit history contains missed payments, defaults, a County Court Judgment (CCJ), previous arrears or other financial problems.

The bigger question is not simply whether you have “bad credit”.

It is what happened, how recently it happened, how much was involved, whether the issue has been resolved and how your finances look today.

This distinction matters because mortgage lenders do not all use identical criteria. One lender may reject an applicant because of a recent adverse credit event, while another may consider the same circumstances if the applicant has a sufficient deposit, stable income and a strong recent payment history.

For London buyers, the challenge can be even greater. Property prices can require substantial borrowing, meaning affordability, deposit size and credit history all need to work together.

The good news is that having a poor credit history does not automatically mean you cannot get a mortgage. Specialist lenders may consider applicants who do not fit the criteria of mainstream high-street lenders, although the available mortgage may come with different rates, fees, deposit requirements or other conditions.

This guide explains how bad credit mortgages in London work in 2026, which types of adverse credit can affect a mortgage application, how lenders assess your circumstances, what you can do before applying and why choosing the right lender matters.

Key Takeaways

  • A poor credit history does not automatically prevent you from getting a mortgage in London.
  • There is no single UK-wide minimum credit score that guarantees mortgage approval. Lenders assess the wider application, including income, affordability, deposit, property and credit history.
  • Recent missed payments, defaults, CCJs and other adverse credit can make borrowing more difficult, particularly when the issues are recent or unresolved.
  • The age and severity of adverse credit can matter. Older credit problems may have less impact than recent issues, although lender criteria vary.
  • A larger deposit can strengthen an application by reducing the loan-to-value ratio, although it does not guarantee approval.
  • Making multiple full mortgage applications can be counterproductive because hard credit searches can appear on your credit file.
  • A mortgage broker can help identify lenders whose criteria are more suitable for your specific credit history before you make a full application.
  • If you have been declined, applying repeatedly without understanding why can make the situation worse. It is usually better to establish the problem first and then consider your options.

Table of Contents

Can You Get a Mortgage With Bad Credit in London?

Yes, it may still be possible to get a mortgage with bad credit in London.

However, there is no universal “bad credit mortgage” that applies to everyone.

Mortgage lenders assess risk differently.

For example, an applicant with:

  • One missed payment from several years ago
  • A large deposit
  • Stable employment
  • Low existing debt
  • Strong recent payment history

may present a very different risk from someone with:

  • Several recent missed payments
  • An outstanding CCJ
  • Multiple defaults
  • High unsecured debt
  • Recent financial difficulties

Both applicants might describe themselves as having “bad credit”, but a lender may assess them very differently.

MoneyHelper explains that lenders consider a range of factors rather than simply relying on a credit score. These can include income, affordability, deposit and the property being purchased.

That is why the first step should be understanding what is actually on your credit file.

What Counts as Bad Credit for a Mortgage?

“Bad credit” is not a formal mortgage category with one universal definition.

It is generally used to describe a credit history containing information that may make a lender view an applicant as higher risk.

Examples include:

  • Missed mortgage payments
  • Missed credit card payments
  • Loan arrears
  • Defaults
  • County Court Judgments (CCJs)
  • Individual Voluntary Arrangements (IVAs)
  • Bankruptcy
  • Debt management arrangements
  • High levels of unsecured borrowing
  • Numerous recent credit applications
  • Payday loan history
  • Financial associations with someone who has adverse credit

MoneyHelper identifies missed or late payments, CCJs and multiple recent credit applications among factors that can make obtaining a mortgage more difficult.

But the presence of one of these markers does not automatically tell a lender everything they need to know.

Recency matters

A credit problem from five years ago is not necessarily treated in the same way as a similar problem from three months ago.

MoneyHelper notes that the impact of missed or late payments can reduce as they become older, while adverse information can remain visible on a credit report for a number of years.

This is why a lender may ask:

“When did the problem occur?”

rather than simply:

“Have you ever had a missed payment?”

How Does Bad Credit Affect a Mortgage Application?

Bad credit can affect a mortgage in several different ways.

It may influence:

1. Whether a lender will accept you

Some mainstream lenders may have strict criteria around adverse credit.

A specialist lender may be more flexible.

2. How much you can borrow

Even if a lender is prepared to accept you, affordability still applies.

A poor credit history does not mean you can borrow an unlimited amount.

3. Your interest rate

Applicants presenting a higher level of credit risk may have access to fewer products or potentially higher borrowing costs.

4. Your deposit requirement

Some circumstances may require a larger deposit to achieve an acceptable loan-to-value ratio.

5. The property you can purchase

The lender must also be comfortable with the property being offered as security.

A borrower with adverse credit may therefore need to satisfy two separate tests:

Can the lender accept the borrower?

and

Will the lender accept the property?

This distinction becomes particularly important when purchasing non-standard or auction properties.

Can You Get a Mortgage With a CCJ?

Potentially, yes.

Having a CCJ does not automatically mean you can never get a mortgage.

However, lenders may consider factors such as:

  • Date of the CCJ
  • Amount
  • Whether it has been satisfied
  • Number of CCJs
  • Reason for the judgment
  • Your current income
  • Deposit
  • Other adverse credit
  • Overall affordability

An old, satisfied CCJ can present a very different lending proposition from a recent, substantial and unsatisfied judgment.

The same principle applies throughout adverse-credit underwriting:

The details matter.

Do not assume that an online article saying “CCJs are accepted” means every lender will accept your particular circumstances.

Can You Get a Mortgage With Defaults?

A default can make obtaining a mortgage more difficult, but it does not necessarily make it impossible.

MoneyHelper explains that defaults can remain visible on credit files for six years from the date they are recorded and can make obtaining credit, including a mortgage, more difficult.

Lenders may consider:

  • How recent the default is
  • How much the default was for
  • Whether it has been satisfied
  • How many defaults you have
  • What caused the default
  • Whether you have maintained clean credit since then

Example

Consider two applicants.

Applicant A

  • One £800 default
  • Default occurred five years ago
  • Debt satisfied
  • No further missed payments
  • Strong income
  • 25% deposit

Applicant B

  • Three recent defaults
  • Total outstanding debt of £15,000
  • Recent missed payments
  • High credit utilisation
  • 10% deposit

Both may say:

“I have defaults.”

But their mortgage applications represent very different levels of risk.

Can You Get a Mortgage With Missed Payments or Arrears?

Again, potentially.

The crucial factors include the type of payment that was missed, how recently it happened, how many payments were missed and whether the account has since been brought up to date.

A recent missed mortgage payment can be particularly significant because it directly demonstrates difficulty maintaining a secured housing commitment.

Other missed payments may be treated differently depending on the lender.

If the adverse credit is recent, waiting and rebuilding a clean payment history may sometimes improve your options.

If you need to buy now, specialist lending may still be worth investigating, but the available products and pricing will depend heavily on the circumstances.

Can You Get a Mortgage After Bankruptcy or an IVA?

It can be possible, but bankruptcy and formal insolvency arrangements can significantly affect mortgage options.

Lenders may consider:

  • Whether the bankruptcy has been discharged
  • How long ago it occurred
  • Whether an IVA is still active
  • Whether debts have been satisfied
  • Your current financial behaviour
  • Income
  • Deposit
  • Affordability
  • The circumstances that caused the financial difficulty

There is no single answer that applies to every borrower.

Someone who experienced financial difficulty many years ago and has subsequently maintained a strong financial record may present a different proposition from someone currently experiencing financial distress.

If you are currently struggling with problem debt, taking on a mortgage should be approached carefully. The objective should not simply be to obtain a mortgage, but to ensure that the proposed borrowing is genuinely affordable.

Does Your Credit Score Matter When Applying for a Mortgage?

Yes—but your credit score is not the whole story.

This is one of the biggest misconceptions about mortgages.

There is no universal UK credit score at which everyone becomes eligible for a mortgage.

Different credit reference agencies calculate scores differently, and lenders use their own underwriting criteria.

MoneyHelper explicitly states that there is no minimum credit score you should aim for because lenders consider multiple factors when deciding whether to offer a mortgage.

Your credit report can contain information about:

  • Credit accounts
  • Payment history
  • Defaults
  • CCJs
  • Credit applications
  • Financial associations
  • Address history

A lender uses this information alongside your mortgage application and affordability assessment.

Don’t obsess over the number

Instead of asking:

“Is my credit score high enough?”

ask:

“What does my complete credit history look like, and how will the lender interpret it?”

That is a much more useful question.

How Much Deposit Do You Need for a Bad Credit Mortgage?

There is no fixed deposit requirement for every bad credit applicant.

The deposit you need depends on the lender, property, affordability and nature of your credit history.

A larger deposit can strengthen an application because it reduces the amount you need to borrow relative to the property value.

For example:

Property price: £400,000

10% deposit: £40,000
Mortgage: £360,000
LTV: 90%

Versus:

25% deposit: £100,000
Mortgage: £300,000
LTV: 75%

The second applicant is borrowing a substantially smaller percentage of the property’s value.

That can potentially make the application more attractive to a lender.

However:

A larger deposit does not automatically cancel out serious recent adverse credit.

The lender still needs to be satisfied that the borrower is suitable and can afford the mortgage.

How to Improve Your Chances of Getting Approved

If you are planning to apply for a mortgage with adverse credit, preparation can make a significant difference.

1. Check all three credit reports

Do not rely on a single credit score app.

Review your reports with the main credit reference agencies and look for:

  • Incorrect defaults
  • Incorrect addresses
  • Accounts you don’t recognise
  • Outdated information
  • Incorrect financial associations
  • Incorrect payment histories

MoneyHelper recommends checking your credit reports before applying for a mortgage and correcting inaccurate information.

2. Register to vote

Being registered at your current address can help credit reference agencies verify your identity and address.

3. Reduce unnecessary debt

Existing debt affects affordability.

Reducing outstanding credit commitments can improve your overall financial position.

4. Avoid unnecessary credit applications

This is particularly important.

Applying to multiple lenders simply to “see who says yes” can create several hard searches.

MoneyHelper warns that multiple applications over a short period can make borrowing more difficult.

5. Maintain perfect payment history from now on

If your previous financial problems are behind you, demonstrate that through consistent behaviour.

Pay:

  • Credit cards
  • Loans
  • Rent
  • Utilities
  • Existing mortgage

on time.

6. Build a larger deposit if possible

A larger deposit can reduce your LTV and potentially improve your options.

7. Keep your financial information consistent

Your mortgage application, bank statements, income evidence and credit history should tell a coherent story.

8. Don’t hide adverse credit

Trying to conceal information is rarely a good strategy.

The lender will conduct its own checks.

It is generally better to understand the issue and identify lenders whose criteria may accommodate it.

What to Do Before Applying for a Bad Credit Mortgage

If your credit history is imperfect, don’t rush straight into a full mortgage application.

Use a structured process.

Step 1: Obtain your credit reports

Understand exactly what is recorded.

Step 2: Identify every adverse marker

Make a simple list:

IssueAmountDateSatisfied?
Default£XDateYes/No
CCJ£XDateYes/No
Missed payment£XDateYes/No

This gives your broker a much clearer picture.

Step 3: Check affordability

Calculate your income and regular expenditure.

Don’t base your expected borrowing solely on a generic income multiple.

Lenders assess affordability using income, spending and financial commitments.

Step 4: Establish your deposit

Know exactly how much you can put toward the purchase.

Step 5: Identify suitable lenders

This is where specialist mortgage advice can become particularly valuable.

Step 6: Consider an Agreement in Principle

Where appropriate, an AIP can help establish an initial indication of borrowing.

But remember that an AIP is not a guarantee of a mortgage offer.

Some AIPs involve a soft search, while others may involve a hard search, so it is worth understanding how the lender will check your credit before proceeding.

Step 7: Make the full application strategically

Only proceed once you have a reasonable understanding of lender suitability.

Can You Get a Bad Credit Mortgage If You Are Self-Employed?

Yes, potentially.

But you have two areas that need to be assessed:

Your credit history

and

your self-employed income.

A lender may need to understand:

  • Business structure
  • Trading history
  • Tax calculations
  • Accounts
  • Salary
  • Dividends
  • Retained profits
  • Business bank statements
  • Personal income
  • Credit history

This can make lender selection particularly important.

For example, a limited company director with historic adverse credit may be assessed very differently depending on whether the lender accepts retained company profits when calculating income.

If you’re self-employed, it’s therefore important to present your income correctly rather than assuming every lender will assess it in the same way.

Can First-Time Buyers Get a Mortgage With Bad Credit?

Yes, potentially.

Being a first-time buyer does not automatically prevent you from obtaining a mortgage because of previous credit problems.

However, you need to consider the combination of:

  • Deposit
  • Income
  • Affordability
  • Credit history
  • Property value
  • Mortgage term
  • Existing debts

For London first-time buyers, the affordability challenge can be particularly significant.

If you’re buying your first property in London, our First-Time Buyer Mortgage in London: Complete Guide to Getting a Mortgage provides a broader overview of the buying process, affordability and mortgage considerations.

A bad credit history may narrow your lender options, but it does not necessarily eliminate them.

Can You Get a Mortgage on an Auction Property With Bad Credit?

This requires particular care.

Buying an auction property already creates additional financing considerations.

Adding adverse credit can make the situation more complex.

Auction purchases may have:

  • Strict completion deadlines
  • Non-standard properties
  • Properties requiring refurbishment
  • Short leases
  • Legal issues
  • Unusual construction
  • Properties that mainstream lenders may not accept

If you have adverse credit and are considering an auction purchase, you should establish your finance position before bidding.

Do not assume that winning the auction means you will automatically be able to obtain a mortgage.

Our guide on whether you can get a mortgage on an auction property explains the key financing considerations buyers need to understand before committing.

And if you’re considering getting approval before the auction, read our guide to mortgage approval before an auction.

The principle is straightforward:

Do your finance homework before the hammer falls—not after it.

Why Bad Credit Mortgage Applications Get Declined

A bad credit mortgage application can fail for many reasons.

Recent adverse credit

A recent default or missed payment may be outside a lender’s criteria.

Too much debt

Even if your credit history has improved, substantial outstanding borrowing can reduce affordability.

Insufficient deposit

A small deposit can increase the lender’s exposure.

Affordability problems

A lender may decide that the proposed mortgage is too large relative to your income and expenditure.

Too many recent applications

Multiple hard searches can create additional concerns.

MoneyHelper specifically advises against simply making repeated applications after a mortgage rejection.

Property problems

The borrower may be acceptable while the property itself is not.

This can happen with:

  • Non-standard construction
  • Severe structural defects
  • Short leases
  • Unusual property types
  • Properties requiring significant renovation

Wrong lender

This is often overlooked.

A decline from one lender does not necessarily mean every lender will decline you.

Mortgage lenders have different risk appetites and underwriting criteria.

What If Your Mortgage Has Already Been Declined?

Don’t immediately submit another application.

First, establish what went wrong.

Possible reasons include:

  • Credit history
  • Affordability
  • Income
  • Deposit
  • Property
  • Employment history
  • Lender-specific criteria
  • Documentation

MoneyHelper recommends investigating the reason for a decline rather than immediately applying elsewhere, partly because multiple applications can affect your credit profile.

Check your credit report

Look for errors or unexpected information.

Review affordability

Perhaps the mortgage amount was too high.

Review the lender’s criteria

The lender may simply not have been suitable for your circumstances.

Get professional advice

A broker can help determine whether the problem is:

“You cannot get a mortgage.”

or:

“You applied to the wrong lender.”

Those are very different conclusions.

Should You Use a Mortgage Broker for Bad Credit?

For straightforward applications, some borrowers may be comfortable approaching lenders directly.

But adverse-credit cases can benefit from careful lender selection.

A mortgage broker can assess factors such as:

  • Type of adverse credit
  • Date of adverse credit
  • Amount involved
  • Whether it is satisfied
  • Income
  • Deposit
  • Property
  • Existing debts
  • Employment status
  • Self-employed income
  • Previous mortgage history

The goal should not be to submit your application to as many lenders as possible.

It should be to identify appropriate lenders before submitting a full application.

This matters because a mortgage application is not a competition where the highest number of applications wins.

Strategic lender selection is generally more sensible than repeatedly applying and hoping someone says yes.

Step-by-Step: How to Get a Bad Credit Mortgage in London

Step 1: Check your credit file

Obtain your credit reports and understand exactly what lenders are likely to see.

Step 2: Identify your adverse credit

Record the type, date, amount and current status of every issue.

Step 3: Review your affordability

Work out your realistic budget based on income and expenditure.

Step 4: Establish your deposit

Know how much cash you have available and where it has come from.

Step 5: Avoid unnecessary credit applications

Don’t approach multiple lenders blindly.

Step 6: Speak to a specialist mortgage broker

Explain your complete circumstances, including adverse credit.

Step 7: Identify potentially suitable lenders

Your broker can assess lender criteria before recommending a route forward.

Step 8: Obtain an AIP where appropriate

An AIP can provide an initial indication of borrowing, although it is not a formal mortgage offer.

Step 9: Find a suitable property

Stay within the borrowing range you have established.

Step 10: Submit the full application

Provide accurate documentation and disclose information honestly.

Step 11: Complete lender underwriting

The lender will assess your income, credit history, affordability and property.

Step 12: Receive your mortgage offer

Once the lender is satisfied, the mortgage can proceed toward completion.

Frequently Asked Questions

Can I get a mortgage with a bad credit score?

Yes, it may be possible. There is no single minimum UK credit score that determines mortgage eligibility. Lenders consider the wider application, including credit history, income, affordability, deposit and property.

What is the lowest credit score accepted for a mortgage?

There is no universal minimum credit score accepted by every UK mortgage lender. Different lenders use different criteria, and your credit score is only one part of the assessment.

Can I get a mortgage with a CCJ?

Potentially. The lender may consider the date, amount, status and circumstances of the CCJ alongside your income, deposit and overall financial position.

Can I get a mortgage with a default?

Potentially. A default can make mortgage approval more difficult, particularly if it is recent, but some lenders may consider applicants with historic defaults depending on their criteria. Defaults generally remain on credit files for six years from the date recorded.

Can I get a mortgage after bankruptcy?

It may be possible, depending on how long ago the bankruptcy occurred, whether it has been discharged and your current financial circumstances. Lender criteria vary significantly.

Can I get a mortgage with missed payments?

Potentially. The number, type and recency of missed payments can influence how a lender assesses your application.

Do I need a larger deposit with bad credit?

Not necessarily in every case, but a larger deposit can strengthen an application by reducing your loan-to-value ratio. The deposit requirement depends on the lender and your overall circumstances.

Can I get a first-time buyer mortgage with bad credit?

Yes, potentially. First-time buyer status does not automatically prevent you from obtaining a mortgage with adverse credit. You will still need to satisfy the lender’s affordability and credit criteria.

Can I get a mortgage if I am self-employed and have bad credit?

Potentially. Your lender will need to assess both your credit history and your self-employed income. The way your income is structured can affect which lenders may be suitable.

Will checking my credit report hurt my credit score?

Checking your own credit report is generally a soft search and does not have the same effect as making a full credit application. MoneyHelper recommends checking your reports before applying for important credit such as a mortgage.

How long should I wait after being refused a mortgage?

There is no universal waiting period. The more important question is why you were declined. Understand the reason first, correct any issues you can and then consider lenders whose criteria fit your circumstances.

Can I get a mortgage in London with bad credit and a small deposit?

It may be possible, but the combination of adverse credit and a high loan-to-value can restrict your options. Your income, credit history, affordability and the property will all need to be considered.

Final Thoughts: Bad Credit Does Not Always Mean No Mortgage

If you’re searching for a bad credit mortgage in London, the first thing to understand is that your credit history is not a simple yes-or-no test.

The question is not:

“Is my credit score bad?”

The better question is:

“What does my credit history look like, how recent are the problems, and which lenders may be able to consider my circumstances?”

A historic missed payment is not necessarily the same as a recent series of defaults.

A satisfied CCJ is not necessarily the same proposition as an outstanding judgment.

And a borrower with adverse credit but strong income, a substantial deposit and clean recent financial behaviour may present a very different risk from someone currently experiencing financial difficulty.

The biggest mistake is therefore applying blindly.

Before making a full mortgage application:

Check your credit file → understand the adverse credit → review affordability → establish your deposit → identify suitable lenders → then apply strategically.

This approach can help you avoid unnecessary applications and give you a clearer understanding of your genuine mortgage options.

If you’re buying your first property in London, explore our guide to first-time buyer mortgages in London. If you’re considering an auction purchase, make sure you understand whether you can get a mortgage on an auction property before committing to a bid.

And if your circumstances are complex, getting specialist mortgage advice can help you understand whether the problem is genuinely your financial position—or simply that you have not yet approached the right lender.

Bad credit can make getting a mortgage harder. It does not always make getting a mortgage impossible.

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