A couple of readers have asked about mortgage fixes when they have a poor credit record or simply a lot of other debt: Ms A: We are in a DMP and we were told it would make it very hard to remortgage. So we are now on Santander’s SVR and it’s over 7%. Can we really just ask them for a new fix and they won’t say no? Mr B: I'm worried about talking to Nationwide when our current mortgage fix ends. … [Read more...]
Articles about Mortgages
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Mortgages are a "priority debt". If you are having difficulty paying the mortgage you need to take debt advice as soon as possible - the earlier you do this, the more options you are likely to have.
These pages list all Debt Camel articles about mortgages in date order. There is a general summary on this page Mortgages and Debt page.
Options if you have an interest-only mortgage
When an interest-only mortgage ends, you have to repay all the amount you borrowed. You can't just carry on paying the interest. The money to repay it can come from three sources: savings or investments; by getting a new mortgage; or by selling your house. How many interest-only mortgages are there? FCA research found that at the end of 2022: There are now fewer than 1 million … [Read more...]
Can you get a mortgage with debts?
People often think that a mortgage lender will look at how good your credit score is. That isn't right - sometimes you can get a mortgage with a not good credit score or you may be rejected with a great credit score. Three key factors in getting a mortgage are: your deposit the affordability calculation - this is affected by current debts that you are repaying; your credit history - … [Read more...]
Support for Mortgage Interest (SMI) – should you take this loan?
Support for Mortgage Interest (SMI) helps some people with the cost of their mortgage if they aren't working. Since 2018 this help has been paid as a loan secured on your house, not a benefit, see the gov.uk page on SMI. But this loan is cheap, you don't have to make any repayments to it until the house is sold and it does not show on your credit record, so this is not as bad as it … [Read more...]
Can I get a mortgage with recent defaults?
A reader, Mr D, asked: My partner and I have a combined income of £56,000, We have a deposit of £28,000 (inheritance) and are looking to become first time buyers at a price of £230,000. We have defaulted debts that are being paid off, and previous history of payday loans from over 2 years ago from a time when our financial situation was much more difficult. The defaults are about 18 months … [Read more...]
How fast can I improve my credit score for a mortgage?
Here are some questions I have seen recently about how long it takes to improve your credit score for a mortgage: I was foolish with credit cards for years but now I am determined to buy a house - how long will this take? My credit score is dreadful. My new partner has a good credit record and we want to get a mortgage. I have a poor credit rating but I have now inherited a deposit. How … [Read more...]
I’m in a DMP – can I get a mortgage?
A reader asked about applying for a mortgage when she is in a Debt Management Plan (DMP): "I have been in a DMP for 8 years and still have 6 to go as I still owe £16,000. With hindsight, I should have gone bankrupt! My parents will give us a 20% deposit in 2021, but they don't know about my debts so I can't use their money to end the DMP. Will I be able to get a mortgage?" I've written before … [Read more...]
“Will partial settlement make it hard to get a mortgage?”
Ms F asked: "I have been in debt management for five years after my marriage breakdown. After an inheritance, I want to pay off my DMP as it will carry on for years. I could pay in full but my house needs some urgent work and my car is on its last legs. I asked about my credit score if I offer a partial settlement and was told this would show as partially settled on credit score file. Will I … [Read more...]
“Can mortgage lenders see old debts, no longer on my credit record?”
A reader asked: I know a debt drops off my credit file 6 years after it was settled or defaulted. I just want to ask when I apply for a mortgage, can the lender dig up unpaid debts if they are no longer showing on my credit report? This is a common question. The answer is Yes, sometimes because a lender can see other information that may show the debts. Let's look at what the lender can see, … [Read more...]
Recent payday loans make it hard to get a mortgage
Having a recent payday loan on your credit history can make it much harder for you to get a mortgage at a good rate - or even at all! If you have used payday loans, the rule of thumb for a mortgage application is to wait until at least 2 years have passed after your last payday loan was settled. Before coronavirus, the usual advice was to wait one year. But from 2020 many mortgage lenders … [Read more...]