Mortgages with CCJ’s

Running into credit problems is very stressful and can have a long-term impact on your borrowing potential. If you’re planning to buy a home, you might wonder if it’s possible to find a bad credit mortgage, especially if you’ve had a County Court Judgement (CCJ). 

How to get a Bad Credit Mortgage if you have CCJs

What is a CCJ?

A County Court Judgment (CCJ) is a court order issued against you when you cannot repay money you owe. You will never get one by surprise: you will receive various written warnings from your lender before the County Court gets involved.

The CCJ is cancelled if you pay back the money you owe within 30 days. If not, the CCJ will appear on your credit record for six years. It will be much harder for you to borrow money in the future – few financial lenders take on customers with CCJs.

Can I get a mortgage if I have a CCJ?

You will normally find it easier to approach lenders if the CCJ was a few years ago and you have stayed out of debt since. You will obtain a better interest rate if you have settled the CCJ. 

Your credit report is of less importance to a lender if you have a large cash deposit – 25% of the property value, for example. A joint mortgage with someone who has a good credit history could also be a good choice.

Is the date of a CCJ important for a mortgage?

You will have a better chance of getting a mortgage if your CCJ was a few years ago. A very recent CCJ will deter most lenders. If the debt was over six years ago, the record should have disappeared from your file.

An older CCJ will have less impact on your mortgage application than one within the past year. Every lender will have unique requirements when it comes to bad credit history.

Does the size of the CCJ affect my mortgage?

Yes, the size of your CCJ is very relevant, especially if it’s recent. A CCJ of £1,000+ in the past 12-24 months is a big red flag to a lender. Meanwhile, a debt of £100 or so, settled four years ago, may not be of too much concern.

It will also help if you have taken steps to improve your credit score since the CCJ.

Can I remove a CCJ from my credit file?

You can remove a CCJ from your record if: 

  • You repaid the debt within 30 days, and have proof
  • It’s more than six years since you received the CCJ yet it still shows on your credit history
  • You can prove that the CCJ wasn’t valid or you settled the debt another way
  • You never received the CCJ in the first place – the record is an error

In these situations, contact the three credit reference agencies (Equifax, Experian and TransUnion) and ask them to add a ‘notice of correction’ to your credit report. 

How can I improve my poor credit rating after a CCJ?

To improve poor credit history,  first confirm you’re on the electoral roll, which is a basic requirement for credit. Checking your credit score online is important to identify any other errors.

If you are in a debt management plan, stick to it closely. Ensure you are always punctual with any other payments due – on your CCJ, credit cards, utility bills and phone, for example. 

Avoid applying for new finance if you can – each time you apply for a loan or payment plan it will show on your record. Too many applications in a short space of time is a bad sign to lenders.

How can a specialist Mortgage Broker help if I’ve had a CCJ?

Ideal Home Loans are dedicated experts in the mortgage sector. If you’re a First Time Buyer wanting to get on the property ladder, or are remortgaging with bad credit, we’ll help with finding a mortgage to suit you.

We’ve helped many clients with CCJs find a suitable mortgage loan. Our advisors will spend time getting to know you and your credit situation to find the right lenders. We make sure that the repayments on your mortgage will be affordable before recommending any products. 

Our team will support you at every step, from finding and applying for a mortgage to chasing up solicitors, lenders and anyone else regarding your property purchase. 

We’re registered in England & Wales and authorised by the Financial Conduct Authority. Take the strain out of finding a mortgage deal: just contact our registered office today.