How to Get a Mortgage with CCJ: Your Complete Guide
If you have a County Court Judgment (CCJ) on your credit report, you might think that getting a mortgage is out of reach. While a CCJ can make the process more challenging, it’s not impossible. In fact, many specialist lenders cater to individuals with poor credit histories, including those with CCJs. In this guide, we’ll walk you through how to get a mortgage with CCJ, what you need to know, and how to improve your chances.
Can You Get a Mortgage with CCJ?
Yes, you can get a mortgage with CCJ, but your options may be limited. High-street banks may decline your application, but specialist lenders are often more flexible. These lenders consider various factors, such as the age of the CCJ, whether it’s been settled, and your current financial situation
Factors Lenders Consider for a Mortgage with CCJ
Lenders will evaluate several factors when reviewing your mortgage application with a CCJ:
- Age of the CCJ: Older CCJs carry less weight. If your CCJ is more than two or three years old, lenders are more likely to overlook it, especially if your financial situation has improved since.
- Has the CCJ been settled?: A settled CCJ (one that you’ve paid off) is viewed more favourably than an unsettled one. Settling your CCJ demonstrates that you’ve taken responsibility for your debts.
- Size of the CCJ: Smaller CCJs may be less of an issue than larger ones. If the debt is relatively small, some lenders may still be willing to offer a mortgage.
- Credit history since the CCJ: Lenders will look at your overall financial behaviour since the CCJ. If you’ve been managing your credit responsibly, paying bills on time, and keeping debt levels low, this can improve your chances.
- Deposit size: A larger deposit can offset the risk of lending to someone with a CCJ. Most lenders will expect a deposit of 15-30% if you have a CCJ, compared to the standard 5-10%.
- Income and affordability: Lenders will assess your current income and overall affordability. A stable, secure income can increase your chances of approval.
Steps to Improve Your Chances of Getting a Mortgage with CCJ
Although getting a mortgage with CCJ is more challenging, there are steps you can take to improve your chances:
1. Settle Your CCJ
If possible, pay off your CCJ before applying for a mortgage. A settled CCJ looks better to lenders than an outstanding one. Once settled, ensure that this is updated on your credit report.
2. Wait Until the CCJ Ages
If your CCJ is recent, consider waiting for it to age. Lenders are more lenient with CCJs that are over two or three years old. In the meantime, work on improving your credit score by making timely payments on any remaining debts.
3. Save a Larger Deposit
A larger deposit (15-30%) reduces the lender’s risk, making them more likely to approve your mortgage. Start saving as much as possible to improve your deposit size.
4. Improve Your Credit Score
Focus on building your credit score by:
- Paying bills on time.
- Reducing your credit card balances.
- Avoiding new credit applications.
- Checking your credit report regularly for errors and disputing any inaccuracies.
5. Use a Specialist Mortgage Broker
At Goodnews Mortgages, we specialise in bad credit mortgages can help you find lenders that are more willing to approve applicants with CCJs. We can guide you through the process and increase your chances of finding the best deal
Specialist Lenders for Getting a Mortgage with CCJ
If traditional high-street lenders have declined your mortgage application due to a CCJ, specialist lenders might be the solution. These lenders are more experienced in dealing with applicants who have bad credit, including CCJs, and can offer more flexible terms. However, keep in mind that interest rates and fees may be higher with these lenders.
Can You Get a Mortgage if You Have Multiple CCJs?
Yes, you can still get a mortgage if you have multiple CCJs. In this case, lenders will likely require a larger deposit, higher interest rates, and proof of improved financial management. Working with an advisor at Goodnews Mortgages is helpful if you have more than one CCJ on your credit file.
How Long After a CCJ Can You Get a Mortgage?
You can technically apply for a mortgage as soon as you have a CCJ, but waiting a few years can improve your chances. Once a CCJ has been removed from your credit file after six years, your options will open up further, allowing you to qualify for more competitive rates
Conclusion
With over a decade experience in mortgages and dealing with clients with adverse credit history and complex circumstances, it is certainly possible with our right approach at Goodnews Mortgages. Settling your CCJ, improving your credit score, and saving a larger deposit can significantly boost your chances. Working with a specialist mortgage firm we can also help you find the right lender who is willing to consider your application.
If you’re looking to get a mortgage with CCJ, start by booking consultation with us. There are options out there, and with the right plan, you can still achieve your homeownership goals.
