Bad credit mortgages

A CCJ is given to a person who fails to make agreed payments on a debt. This is typically a last resort for creditors after exhausting other means of obtaining payment. It’s important to note that even if the CCJ is not pursued, the previous steps taken to demand payment will still negatively affect your credit score.

If you have been issued a CCJ, it’s important to understand its impact on your chances of getting a mortgage. Lenders will consider factors such as whether the CCJ has been paid off or is still outstanding, when it was issued, and the amount of the CCJ. The size of your deposit will also be a key factor.

If the CCJ has been paid off within 30 days or successfully appealed against, it is less likely to affect your chances of obtaining a mortgage. However, if it has been settled within the past three years, some lenders may still refuse to approve a mortgage.

If you have ignored the CCJ and it has resulted in a judgment in default, this can further decrease your chances of obtaining a mortgage. The date of issue and size of the CCJ will also play a role in a lender’s decision, with many requiring it to be settled for more than a year before considering a mortgage.

When it comes to the size of the CCJ, lenders will be more cautious if it was issued within the past two years and for a larger amount. This can affect the amount of deposit required for a mortgage, with a CCJ issued within the past year potentially requiring a deposit of 25-35%.

It’s important to note that the more CCJs you have, the more difficult it may be to obtain a mortgage. However, the size of your deposit can also influence a lender’s decision.

To increase your chances of getting a mortgage with a CCJ, it’s important to ensure that all repayment requirements are up to date and to avoid applying for too much credit. Checking your credit report for accuracy can also be helpful. Lenders will also consider the size of your CCJ and employment history during affordability checks.

When it comes to the type of mortgage, a standard or remortgage is more likely to be approved, with first-time buyer mortgages potentially facing stricter criteria. If a remortgage is not an option, a secured loan may be possible if there is adequate equity in the property.

Other financial issues such as defaults, debt management plans, IVAs, and bankruptcy can also affect your chances of obtaining a mortgage. Lenders will typically require these to be fully repaid before considering a mortgage application.

If you are looking to obtain a buy to let property, a longer period since the issue of the CCJ and a larger deposit may be required.

A discharged CCJ means that the debt has been fully paid off or settled, and the court has formally closed the case. This can have a positive effect on the individual’s credit score, as it shows that they have taken responsibility for their debt and fulfilled their obligations.

It is not necessary to settle a CCJ before applying for a mortgage. However, the date and amount of the CCJ registration may impact the options available to you.

Upon reaching the court, you will be allotted a period of 14 days to settle the outstanding debt in its entirety. Doing so will prevent it from being reflected on your credit report.