Mortgage with CCJs
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Securing a mortgage with a County Court Judgement (CCJ) can often seem like a daunting task. However, it is not an impossible one. While a CCJ can indeed present challenges in the mortgage application process, understanding the nuances can significantly improve your prospects. In this guide, we’ll extensively explore the concept of obtaining a mortgage with a CCJ, addressing frequently asked questions and common concerns. We will discuss how CCJs impact your credit standing, various mortgage options available, and strategies that can increase your chances of approval. By the end of this guide, you’ll be equipped with the knowledge and insights needed to navigate your path to homeownership, even with a CCJ on your record.
A mortgage with a County Court Judgement (CCJ) refers to a mortgage that a person applies for or holds when they have a CCJ against them. A CCJ is a type of court order in England, Wales, and Northern Ireland that might be registered against an individual if they fail to repay the money they owe.
When a person has a CCJ, it can make getting a mortgage more difficult. This is because lenders often see this as a sign that the borrower has had difficulties managing their finances in the past, which could indicate that they are at a higher risk of not repaying the mortgage.
However, having a CCJ doesn’t necessarily mean that a person won’t be able to get a mortgage. There are some lenders who might consider applicants with a CCJ, especially if the judgement is satisfied (paid), was for a small amount, or occurred due to circumstances that have since changed or been resolved.
A person with a CCJ might need to provide more information to the lender about the judgement and may be offered less favourable terms than other borrowers, such as needing a larger deposit or being charged a higher interest rate. They might also benefit from using the services of a specialist mortgage broker who can help them find suitable lenders.
A County Court Judgement (CCJ) is a type of court order in the United Kingdom that may be registered against an individual if they fail to repay the money they owe. These judgments are made by a County Court and can happen when someone has defaulted on their debt repayments.
When a creditor takes court action against you due to non-payment of a debt, and you either do not respond to the court claim or are unable to repay the amount claimed, the court can issue a CCJ. This is a formal legal judgement that confirms that the debt is owed and stipulates how the debt should be repaid.
A County Court Judgement (CCJ) will typically stay on your credit file for six years from the date of the judgement. This is true whether or not you’ve paid off the debt. If you pay the full amount owed within one month of the judgement, you can have the CCJ removed from your credit file altogether.
If you pay the debt more than a month after the judgement, the CCJ will be marked as “satisfied” on your credit file. While this doesn’t remove the CCJ, it shows prospective lenders that you’ve taken steps to resolve the issue. However, even a satisfied CCJ can make it more difficult to secure credit, as it indicates past financial difficulties.
It’s always a good idea to check your credit file regularly to ensure all information, including details about CCJs, is accurate. You have the right to correct mistakes on your credit file, and you can also add a “notice of correction” to explain any mitigating circumstances that led to any negative marks like a CCJ.
Getting a mortgage with a County Court Judgement (CCJ) can be challenging, but it’s not impossible. Here are some steps you might consider:
Understand your credit report: Before applying for a mortgage, get a copy of your credit report and understand exactly what it says about your financial history. Check for any errors and correct them.
Settle your CCJs: If possible, pay off your CCJs. A “satisfied” CCJ is viewed more favourably than an “unsatisfied” one. Remember to get proof of payment.
Save for a larger deposit: Lenders may be more likely to give you a mortgage if you can put down a larger deposit, as this reduces their risk.
Work on improving your credit score: Aside from the CCJs, make sure you’re managing your current financial obligations responsibly. This includes paying all your bills on time, not maxing out your credit cards, and not applying for new credit unless necessary.
Wait it out: A CCJ stays on your credit file for six years. If you can wait, your chances of getting a mortgage might improve once it’s no longer on your record.
Consult a mortgage broker: A broker who specialises in bad credit mortgages can give you advice tailored to your situation and help you find a lender who is more likely to approve you despite the CCJ.
Be honest with lenders: When applying for a mortgage, be upfront about your CCJs and explain the circumstances that led to them. Lenders appreciate honesty, and it can help them make an informed decision.
Consider specialist lenders: Some lenders specialise in offering mortgages to people with bad credit or CCJs. They might charge higher interest rates, but they can be an option if other lenders turn you down.
Every lender has different criteria, so don’t be discouraged if you’re turned down by one lender. It’s important to keep in mind, however, that each application could impact your credit score, so it’s usually best to make an initial inquiry or use eligibility calculators before applying fully.
Yes, it is possible to get a mortgage with a County Court Judgement (CCJ), but it may be more challenging. A CCJ can negatively impact your credit score, and lenders may view it as evidence that you’ve had difficulties managing your finances in the past. However, different lenders have different criteria, and some will consider applicants with a CCJ.
Here are a few factors that can influence your ability to get a mortgage with a CCJ:
The age of the CCJ: A CCJ remains on your credit file for six years, but lenders may be more willing to lend if the CCJ is older and you’ve had a clean record since.
Whether the CCJ is ‘satisfied’: A satisfied CCJ, which means it’s been paid off, is viewed more favourably than an unsatisfied one.
The size of your deposit: If you can provide a larger deposit, it might reassure lenders that you’re capable of handling the financial commitment of a mortgage.
Your current financial situation: If your financial situation has improved significantly since the CCJ was issued, lenders may be more willing to consider you.
The reason for the CCJ: If the CCJ was due to a one-off situation that is unlikely to happen again, some lenders might take this into account.
Specialist lenders or brokers can often help find a suitable mortgage product for those with a CCJ. It’s important to be transparent about your situation and provide as much information as possible when applying for a mortgage. Be aware, though, that you may face higher interest rates and tighter lending criteria due to the increased perceived risk.
No, not all mortgage lenders will reject applicants with a County Court Judgement (CCJ). While having a CCJ can make getting a mortgage more difficult because it’s often seen as a sign of past financial troubles, there are lenders who will consider applicants with a CCJ.
Different lenders have different lending criteria and risk tolerance. Some lenders, particularly high-street banks, tend to be more stringent and may not lend to someone with a CCJ. However, there are specialist lenders who work with individuals with adverse credit histories, including those with CCJs.
Yes, there are specialist mortgage lenders who consider applicants with adverse credit histories, including those with County Court Judgements (CCJs). These lenders are often referred to as “subprime” lenders, “non-prime” lenders, or “adverse credit” lenders.
These lenders understand that various circumstances can lead to financial difficulties and are willing to consider applications that other, often larger, lenders might reject. However, it’s important to note that mortgages from these lenders often come with higher interest rates and potentially higher fees, reflecting the greater perceived risk associated with lending to people with a history of credit issues.
Using a mortgage broker who specialises in adverse credit can be very helpful in this situation. They can help you navigate the landscape, understand your options, and find a lender who is more likely to approve your application, given your specific circumstances.
However, always consider your ability to make repayments before securing a mortgage. Borrowing with a poor credit history can be more expensive, so it’s important to ensure the repayments are manageable. If you’re unsure, seek independent financial advice.
In the UK, securing a joint mortgage when one or both applicants have a County Court Judgement (CCJ) is possible, but it can be challenging. While many mainstream lenders may be hesitant or decline such applications, there are specialist lenders who cater to those with adverse credit histories. The specific details of the CCJ, such as its date, amount, and whether it’s been satisfied, will influence a lender’s decision. A larger deposit might improve the chances of approval as it can offset the perceived risk.
Getting a mortgage with a County Court Judgement (CCJ) can be challenging, but there are options available:
High street banks: Some high street banks may still consider your mortgage application even with a CCJ, especially if it’s old, has been satisfied, and/or was for a small amount.
Building societies: Building societies may sometimes have more flexibility in their lending criteria compared to banks. They might consider the overall circumstances surrounding the CCJ.
Specialist lenders: Certain lenders specialise in offering mortgages to people with poor credit history, including CCJs. These tend to be smaller, specialist lenders rather than large, high-street banks. Keep in mind, though, that the interest rates may be higher due to the perceived risk.
Bad credit brokers: Mortgage brokers who specialise in bad credit cases can be very helpful. They can give you advice based on your specific circumstances and can help you find suitable lenders.
Joint mortgage: If you have a partner or family member who has a good credit history, you could consider a joint mortgage. However, this should be carefully considered, as the other person would also be fully responsible for the debt.
Guarantor mortgage: Another option might be a guarantor mortgage, where a third party (usually a family member) agrees to cover your mortgage payments if you can’t. This also carries significant risk for the guarantor, so it should be considered carefully.
The amount you can borrow for a mortgage if you have a County Court Judgement (CCJ) will depend on a number of factors and can vary greatly from lender to lender. It’s not solely about the CCJ – lenders will also consider your income, outgoings, the size of your deposit, and your overall credit history.
Income: Lenders typically offer mortgages up to a certain multiple of your income. This is often around 4-4.5 times your annual income but can sometimes be higher.
Outgoings: Lenders will also consider your regular outgoings and existing debts when determining how much you can afford to borrow. This includes credit card debts, personal loans, car finance, and living costs.
CCJ details: The details of your CCJ may influence how much a lender is willing to lend. If the CCJ is older, has been satisfied, and/or was for a small amount, lenders might be more willing to lend a larger amount.
Credit history: Apart from the CCJ, lenders will look at your overall credit history. Regularly missed payments on other debts might make lenders more cautious, reducing the amount they’re willing to lend.
Employment status: Stable employment and a regular income can make you a less risky borrower in the eyes of lenders.
When applying for a mortgage with a County Court Judgement (CCJ), you’ll generally need to provide the same documentation as any other applicant. This typically includes:
Proof of income: This might be recent payslips and a P60 from your employer, or if you’re self-employed, you might need to provide two to three years’ worth of accounts or tax returns.
Bank statements: Lenders will want to see typically three months’ worth of recent bank statements to understand your spending habits and financial commitments.
Proof of identity: This could be a passport or driving licence.
Proof of address: Utility bills or council tax statements are commonly used to verify your address.
Credit report: While lenders will usually check this themselves, it’s a good idea to review your own report so you’re aware of what they’ll see.
Proof of deposit: You will need to show that you have the necessary funds for the mortgage deposit and be able to explain the source of the funds.
In addition to the above, if you have a CCJ, you may also need to provide:
Details about the CCJ: This will likely include information about when the CCJ was issued, the amount it was for, whether it has been satisfied, and any surrounding circumstances.
The size of the deposit you’ll need when applying for a mortgage with a County Court Judgement (CCJ) can vary significantly depending on a number of factors, including the specific lender’s criteria, the size and age of the CCJ, and your overall financial circumstances.
In general, a larger deposit is more likely to be favourable when applying for a mortgage with a CCJ, as it lowers the lender’s risk. While a typical deposit for a standard mortgage can range from 5% to 20% of the property’s value, if you have a CCJ, you may be asked to put down a larger deposit. This could potentially be around 15% to 30%, although this will vary from lender to lender.
It’s also worth noting that having a larger deposit can increase your chances of being approved for a mortgage and potentially secure you a better interest rate.
The date when your County Court Judgement (CCJ) was registered is crucial because it can significantly influence a lender’s decision to grant you a mortgage.
If the CCJ is recent, this could indicate recent financial difficulty, which might make lenders wary. On the other hand, if the CCJ is several years old and you’ve managed your finances responsibly since then, lenders may be more willing to consider your application. They might view the CCJ as a past issue that has been resolved or managed.
As a general rule, the further in the past, the CCJ was registered, the less impact it may have on a mortgage application. After six years, the CCJ will be removed from your credit file, even if it was not fully paid off.
As mentioned, A County Court Judgement (CCJ) will stay on your credit record for six years from the date it was issued, and during this period, it can affect your ability to get a mortgage. However, the impact of the CCJ on your mortgage prospects often diminishes over time, particularly if it has been paid (satisfied) and you’ve managed your finances responsibly since it was registered.
While the CCJ is on your credit record, mortgage lenders will be able to see it when they run a credit check, which they typically do as part of the mortgage application process. Having a CCJ can make it more difficult to secure a mortgage, particularly if the CCJ is recent. However, some lenders are willing to offer mortgages to people with CCJs, especially if there are mitigating circumstances and the CCJ is satisfied.
Even after the CCJ has been removed from your credit record, you might still be asked whether you’ve ever had a CCJ when applying for a mortgage. Honesty is crucial in these situations, as failure to disclose could be considered mortgage fraud.
A County Court Judgement (CCJ) will automatically be removed after six years from the date it was issued, even if the CCJ was not fully paid off. However, under certain circumstances, it might be possible to have a CCJ removed from your credit file before the six-year period ends:
Payment within one month: If you pay the full amount of the CCJ within one month of the judgement being issued, you can apply to have the CCJ removed from your credit record. You’ll need to provide the court with proof of payment, and there’s usually a fee for this.
Set aside the judgement: If you believe the CCJ was issued in error (for instance, if you didn’t receive the original claim paperwork or you had already paid the debt in full), you can apply to the court to have the judgement ‘set aside’. This process will usually require a court hearing, and there’s typically a fee to apply. If your application is successful, the CCJ will be removed from your record. Given the complexity of this process, you might want to get legal advice before proceeding.
Incorrect information: If the details of the CCJ on your credit record are incorrect, you can dispute this with the credit reference agencies and ask them to correct it. In some cases, this could result in the CCJ being removed from your record.
When a County Court Judgement (CCJ) is referred to as being “satisfied”, it means that the debt which led to the judgement has been fully paid off. If you have a CCJ and you’ve paid the debt in full, you can apply to the court to have it marked as “satisfied” on your credit file.
It’s important to provide proof of payment to the court, as this can make a significant difference to how the CCJ is viewed by potential lenders or others checking your credit history. While a satisfied CCJ will still stay on your credit record for six years from the date it was issued, lenders may look more favourably upon a satisfied CCJ compared to an unsatisfied one.
If you’re planning to apply for a mortgage or any other form of credit, it’s always a good idea to check your credit file first to ensure all information, including details about any CCJs, is correct. If you have paid a CCJ and it’s not marked as satisfied, you can apply to the court to correct this. There may be a small fee involved.
An unsatisfied County Court Judgement (CCJ) means that the debt that led to the judgement has not been fully paid off. This is likely to have a more negative impact on your credit file and can make it more difficult to secure credit, including a mortgage.
If you’re applying for a mortgage with an unsatisfied CCJ, it’s important to be aware of the following points:
Higher interest rates or larger deposits: Lenders may see you as a higher risk if you have an unsatisfied CCJ. As a result, they may charge higher interest rates or require a larger deposit to offset the risk.
Limited choice of lenders: Many lenders may be reluctant to offer a mortgage to someone with an unsatisfied CCJ. However, there are specialist lenders who offer mortgages to people with adverse credit. Working with a mortgage broker who specialises in this area could be beneficial.
If you have the means to do so, it’s recommended to pay off the CCJ as soon as possible. This can improve your chances of securing a mortgage, as lenders may view a satisfied CCJ more favourably than an unsatisfied one. If you’re struggling with debt, consider seeking advice from a debt advice service.
A satisfied County Court Judgement (CCJ) means that the debt which led to the judgement has been fully paid. Even though a CCJ will stay on your credit record for six years, regardless of whether it’s satisfied or not, lenders may view a satisfied CCJ more favourably than an unsatisfied one.
The length of time since the CCJ was satisfied, can be a significant factor for lenders. A recent CCJ, even if satisfied, may cause more concern than one that was satisfied a few years ago.
While having a satisfied CCJ can improve your chances of getting a mortgage, you may still face higher interest rates or be required to provide a larger deposit than someone without a CCJ. This is because lenders may still see you as a higher risk.
Remember, even if you have a CCJ, satisfied or not, it’s still possible to improve your credit over time. Consistently making payments on time, not using all your available credit, and not applying for too much new credit at once can all contribute to improving your credit score.
The size of a County Court Judgement (CCJ) can play a crucial role in a lender’s decision-making process when it comes to offering a mortgage. The CCJ amount essentially reflects the debt that led to the judgement. Larger CCJs can indicate greater financial difficulty, which might make a lender more hesitant to offer a mortgage.
Here’s what you need to know:
Regardless of size, more recent CCJs tend to have a bigger impact on your ability to get a mortgage than older ones.
Different lenders have different policies regarding CCJs. Some may not lend to someone with a large CCJ, while others may do so but require a larger deposit or charge a higher interest rate.
If you have a large CCJ, it could be beneficial to seek advice from a mortgage broker who specialises in adverse credit situations. They can help you understand your options and guide you through the application process.
The number of County Court Judgements (CCJs) on your credit report can significantly influence a lender’s decision to offer you a mortgage. Each CCJ represents a separate instance where you’ve been unable to repay a debt, so multiple CCJs can indicate a history of serious financial difficulty. Here’s what you need to know:
Having a County Court Judgement (CCJ) can limit the types of mortgages available to you, but it doesn’t necessarily preclude you from getting a mortgage altogether. Some of the common types of mortgages that might be available to individuals with a CCJ include:
Standard Mortgages: Even with a CCJ, you might still be able to secure a standard repayment mortgage, particularly if your CCJ is older, small, and satisfied. However, this depends on the specific lending criteria of the mortgage provider.
Adverse Credit Mortgages or Bad Credit Mortgages: These are mortgages offered by lenders who specialise in lending to individuals with a poor credit history, which can include CCJs, defaults, bankruptcy, etc. They typically come with higher interest rates compared to standard mortgages due to the perceived risk to the lender.
Guarantor Mortgages: In some cases, a person with a CCJ might be able to get a mortgage if they have a guarantor. The guarantor (typically a family member) agrees to cover the mortgage payments if the borrower is unable to do so.
Right to Buy Mortgages: If you are a council tenant with a right to buy your home, some lenders may consider your application even if you have a CCJ.
Shared Ownership Mortgages: Some shared ownership schemes may consider applicants with a CCJ, but this can depend on the specific policies of the housing association.
Yes, it is possible to remortgage with a County Court Judgement (CCJ), but it can be more challenging compared to remortgaging without one. A CCJ indicates to lenders that you’ve had trouble repaying debt in the past, which can make them more hesitant to offer a loan. However, certain factors can improve your chances of getting approved:
Yes, it is possible to get a mortgage even if you’ve had further credit problems beyond a County Court Judgement (CCJ), but it can be more challenging, and you may have fewer options available. Some of the most common credit problems include:
Defaults: Failure to pay a debt as agreed, leading to a default, can negatively impact your credit score.
Bankruptcy: A declared bankruptcy will significantly impact your ability to get a mortgage, at least until it’s discharged.
Individual Voluntary Arrangements (IVAs) and Debt Management Plans (DMPs): These formal arrangements to pay off your debts will also affect your ability to secure a mortgage.
Missed or late payments: These can affect your credit score, making it harder to secure a mortgage.
Despite these credit issues, it’s not impossible to get a mortgage. Here’s what you should know:
Satisfaction Status: If you’ve satisfied your debts (paid them off), this will look more favourable to lenders.
Time Since Credit Problems: Generally, the further in the past your credit problems are, the less impact they’ll have on your mortgage application. Recent issues are more likely to negatively affect your chances.
Specialist Lenders: Some lenders specialise in providing mortgages to individuals with adverse credit histories, including those with CCJs, defaults, IVAs, or bankruptcies. These mortgages often come with higher interest rates to offset the lender’s risk.
Good Recent Credit Behaviour: Showing that you’ve been able to manage your credit well recently can help offset past credit problems.
Regardless of the type of debt, any County Court Judgement (CCJ) can negatively impact your mortgage application because it signals to lenders that you have previously struggled to manage your financial obligations. Whether the CCJ is related to credit card debt, a personal loan, utility bills, or any other type of debt, it will generally be viewed negatively by most lenders.
Your current income, job stability, credit score, and debt-to-income ratio will also be significant factors in a lender’s decision.
Rebuilding your credit score after receiving a County Court Judgement (CCJ) can take time and patience, but it is certainly possible. Here are some steps you can take:
Satisfy Your CCJ: Pay off the debt related to the CCJ as soon as you can. Once paid, the CCJ will be marked as “satisfied” on your credit report, which looks better to lenders than an “unsatisfied” CCJ. Ensure the court has updated the status of your CCJ to “satisfied.”
Maintain Timely Payments: Make sure you’re making all of your other payments (rent, utilities, credit cards, loans) on time. Late or missed payments can negatively impact your credit score.
Pay Down Debt: Reduce the amount of debt you owe wherever possible. Lowering your overall debt can improve your credit score and make you look less risky to potential lenders.
Avoid New Debt: Try to avoid taking on new debt while you’re working on improving your credit score. Applying for new credit can result in hard inquiries on your report, which can lower your score.
Credit Builder Products: Consider using credit builder products, like a credit builder credit card or loan. These products are designed for people with poor or no credit and can help you build a history of responsible credit use.
Regularly Check Your Credit Report: Monitor your credit report regularly to make sure it’s accurate. Dispute any errors you find with the credit reference agency.
Stay within Credit Limits: Try to use less than your total available credit. A lower credit utilisation rate can positively affect your credit score.
Time: Remember, a CCJ will automatically be removed from your credit report six years after the date it was issued, whether it’s satisfied or not. The impact of the CCJ on your credit score will lessen over time, particularly if it’s satisfied.
Seek Advice: Consider speaking with a financial adviser or a debt charity if you need more advice on managing your debts and improving your credit score.
Rebuilding your credit after a CCJ can be a long process, but it’s definitely achievable with consistent effort and responsible financial behaviour. It’s important to learn from past mistakes and adopt healthier financial habits moving forward.
Learn more: Can you get a mortgage with poor credit?
A mortgage broker can be extremely helpful if you’re trying to get a mortgage and you have a County Court Judgement (CCJ). Here’s how:
Adverse Credit Specialists: Some mortgage brokers specialise in working with clients who have adverse credit, including CCJs. They have an understanding of the mortgage products available for individuals in your situation and can guide you to the most suitable options.
Access to a Wide Range of Lenders: Mortgage brokers often have access to a wide range of lenders, including those who specialise in lending to people with a history of poor credit. This can increase your chances of finding a lender who will approve your application.
Expert Guidance: A broker can provide expert advice on how to improve your chances of getting a mortgage, such as how to improve your credit score or manage your CCJ.
Application Assistance: A broker can also help you with the mortgage application process, ensuring that all paperwork is completed correctly and helping to expedite the process.
Negotiation Power: Mortgage brokers often have the ability to negotiate with lenders on your behalf. They may be able to secure more favourable terms or rates than you would be able to on your own.
Time and Effort Saving: Looking for a mortgage when you have a CCJ can be time-consuming and stressful. A mortgage broker can save you time and effort by doing most of the legwork for you.
Yes, the date of your County Court Judgement (CCJ) does matter when applying for a mortgage. Lenders usually consider more recent CCJs as a higher risk than those that are older. Also, any CCJ will automatically be removed from your credit report six years after the date it was issued, whether it’s satisfied or not. A satisfied CCJ (where the debt has been fully paid off) will generally be viewed more favourably by lenders than an unsatisfied one, regardless of its age.
Getting a mortgage with a satisfied CCJ can be challenging, but it’s not impossible. Here are some steps to consider:
Work with a Specialist: Certain mortgage brokers and lenders specialise in working with people with adverse credit histories. They may be able to assist you in finding a mortgage product suitable for your circumstances.
Save for a Larger Deposit: If you can, saving for a larger deposit can improve your chances of being approved for a mortgage as it reduces the lender’s risk.
Improve Your Credit: Aside from satisfying your CCJ, work on improving your overall credit score by paying all other debts on time, reducing your credit utilisation, and correcting any errors on your credit report.
Maintain a Stable Income: A stable income and job can help convince lenders that you’re capable of making your mortgage payments.
A CCJ won’t directly affect your existing mortgage. If you’re up-to-date with your mortgage payments and not looking to change your mortgage, a CCJ will not typically impact it. However, if you want to remortgage, move your mortgage to a new lender, or borrow more money against your property, a CCJ could make this more difficult. Lenders will usually conduct credit checks before approving changes to an existing mortgage or lending additional funds. Having a CCJ can affect these checks and may impact your ability to change or add to your mortgage.
Yes, a County Court Judgement (CCJ) from a previous address can still affect your mortgage application. When you apply for a mortgage, lenders will run a credit check which includes all information linked to you, not just your current address. A CCJ is registered against you as an individual, not against an address. So, if you have a CCJ, it can be seen on your credit report and can affect your mortgage application, regardless of whether you’ve moved house since it was issued.
Getting a buy-to-let mortgage with a CCJ can be challenging, but it is not impossible. As with residential mortgages, the specific requirements will vary between lenders. Some lenders may be willing to consider your application if the CCJ is older if it has been satisfied, and if you meet their other criteria, such as having a larger deposit or demonstrating a stable income. Again, a mortgage broker who specialises in adverse credit situations may be able to help you navigate the application process. As always, it’s crucial to ensure you can afford the mortgage repayments before proceeding.
Both a default and a County Court Judgement (CCJ) are seen as negative marks on your credit report and can impact your ability to get a mortgage. However, the severity of their impact can differ:
Default: A default occurs when you fail to keep up with the repayments on a loan or credit agreement. It is usually recorded on your credit report after several missed payments. Defaults can make it more difficult to obtain a mortgage, but not impossible. The impact of a default reduces over time, especially if it is paid and your other credit accounts are managed well.
CCJ: A CCJ is more serious than a default. It’s issued when you’ve failed to repay the money you owe, and the creditor has taken court action against you. Mortgage lenders often view CCJs as a significant negative event. Like a default, the impact of a CCJ reduces over time and is removed from your credit file after six years. If it’s satisfied, it will be viewed more favourably than an unsatisfied one.
In general, the more recent and frequent the defaults or CCJs, the more difficult it will be to get a mortgage. However, each lender will have its own criteria, so it’s always worth talking to a mortgage broker or advisor if you’re unsure.
If you have a CCJ and are applying for a mortgage, honesty is the best policy. You should be open and upfront about your CCJ when talking to potential lenders. Explain the circumstances that led to the CCJ, show what steps you’ve taken to address it (for example, if you’ve paid off the debt in full), and demonstrate how you’ve improved your financial situation since then. Lenders appreciate transparency, and showing that you’ve learned from past financial mistakes can help your case.
Getting a commercial mortgage with a CCJ can be challenging but is not impossible. Commercial lenders, like residential mortgage lenders, will consider your credit history when deciding whether to approve your application. If you have a CCJ, some lenders may see you as a higher risk. However, each lender has different criteria, and some are more flexible than others. Factors such as the size and age of the CCJ, whether it’s been satisfied, your business’s financial health, and the deposit amount can all play a role. Speaking with a commercial mortgage broker can be particularly beneficial in navigating this complex area.
If you receive a County Court Judgement (CCJ) after your mortgage has been approved but before completion, it’s essential to notify your lender immediately. Failure to do so can be seen as fraud. The lender may reassess your application based on the new information, and it may affect the terms of your mortgage or potentially result in your mortgage offer being withdrawn. If you have already completed the purchase and started your mortgage, then the CCJ will not directly impact your existing agreement. However, it could affect your ability to remortgage or get a good deal when your initial interest rate term ends.
If you believe that a CCJ has been issued against you unfairly or due to an error, you can challenge it. This usually involves applying to the court to have the CCJ set aside. You will need to provide a good reason why you didn’t respond to the original court claim (such as not receiving the claim documents) and have a reasonable prospect of successfully defending the claim. This can be a complex process, so you should seek legal advice before proceeding. Successfully having a CCJ set aside will remove it from your credit record, which could improve your chances of getting a mortgage.
Having a guarantor might improve your chances of getting a mortgage if you have a CCJ, as the guarantor agrees to cover your mortgage payments if you can’t. This reduces the risk to the lender. However, being a guarantor is a significant commitment, and the person you’re asking will need to be comfortable with this risk. It’s also worth noting that not all lenders offer guarantor mortgages, and those that do will still conduct a full assessment of your circumstances, including any CCJs. If your CCJ is significant, it may still affect your chances of securing a mortgage, even with a guarantor.
There isn’t a set number of County Court Judgements (CCJs) that are considered “too many” for a mortgage application, as each lender has their own criteria. However, having multiple CCJs will make it more difficult to secure a mortgage, as it could indicate to lenders that you have had significant difficulties managing your debts in the past.
If you have multiple CCJs, you may need to approach a specialist lender or broker who deals with adverse credit situations. These providers understand that people can find themselves in difficult financial situations and will look at your individual circumstances to determine whether you can afford the mortgage repayments.
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Please keep in mind that while we may not be local to you, we may still assist you. Imagine if you had a long-term health issue that needed to be addressed. Would you rather have the person who is closest to you or the person who is the best? Now is the moment to put that critical thinking to work in your search.
Legal
Count Ready Limited is registered in England and Wales, No: 10283205. Registered Address: Unit 10, Robjohns House, Navigation Road, Chelmsford, England, CM2 6ND.
Count Ready Limited is an Appointed Representative of Connect IFA Limited 441505 which is Authorised and Regulated by the Financial Conduct Authority and is entered on the Financial Services Register (https://register.fca.org.uk/s/) under reference: 976111.
The FCA do not regulate some forms of Business Buy to Let Mortgages and Commercial Mortgages to Limited Companies.
The information contained within this website is subject on the UK regulatory regime and is therefore targeted at consumers based in the UK.
We usually charge fees of £595 on offer, but we will agree to our fees with you before we undertake any chargeable work. We will also be paid by commission from the lender.
Commission disclosure: We are a credit broker and not a lender. We have access to an extensive range of lenders. Once we have assessed your needs, we will recommend a lender(s) that provides suitable products to meet your personal circumstances and requirements, though you are not obliged to take our advice or recommendation. Whichever lender we introduce you to, we will typically receive commission from them after completion of the transaction. The amount of commission we receive will normally be a fixed percentage of the amount you borrow from the lender. Commission paid to us may vary in amount depending on the lender and product. The lenders we work with pay commission at different rates. However, the amount of commission that we receive from a lender does not have an effect on the amount that you pay to that lender under your credit agreement.
Disclaimer: All content on the Count Ready website can only ever provide general information and does not constitute financial advice. For this reason, we always recommend that you speak to authorised advisers for your needs. (Please be aware that by clicking onto any outbound links you are leaving the www.countready.co.uk. Please note that neither Count Ready or Connect IFA are responsible for the accuracy of the information contained within the linked site(s) accessible from this website.)
© Count Ready – 2024. All rights reserved.
