Can You Switch Mortgage Lenders with Bad Credit?
If you’re thinking about changing your lender but are worried that your bad credit might stop you, you’re not alone. Many homeowners ask whether they can switch mortgage lenders with bad credit, especially when their deal ends or interest rates rise.
The good news? Yes — switching lenders (known as remortgaging) is possible even if your credit isn’t perfect. While high-street banks might hesitate, specialist lenders often take a more flexible approach and consider your full financial picture.
At Mortgage Bridge, we regularly help clients remortgage or switch lenders after missed payments, defaults, or past financial issues. Let’s explore how it works and what you can do to make it easier.
What Does It Mean to Switch Mortgage Lenders?
Switching lenders, or remortgaging, means moving your mortgage from one lender to another — often to secure a better rate, release equity, or adjust your term.
You might want to switch because:
- Your fixed-rate deal is ending.
- You’re paying a higher variable rate.
- You want to consolidate debts.
- You’re unhappy with your current lender’s terms.
When switching lenders with bad credit, the process is similar to applying for a new mortgage, but there are extra checks to assess affordability and risk.
Can You Switch Mortgage Lenders If You Have Bad Credit?
Yes, you can. Having bad credit doesn’t automatically prevent you from switching. However, it may narrow your choice of lenders and affect the rate offered.
Most major banks use strict criteria, but there are specialist lenders who regularly help clients switch even with:
- Missed or late payments
- Defaults or County Court Judgments (CCJs)
- A past Debt Management Plan (DMP)
- Bankruptcy or IVA history
- High credit card utilisation
We work with both mainstream and specialist lenders who assess each case manually — focusing on how you’re managing your finances now, not just what happened in the past.
How Does Bad Credit Affect a Remortgage Application?
When you apply to switch mortgage lenders with bad credit, lenders will check your credit reports from Experian, Equifax, and TransUnion. They’ll look for:
- Any recent missed payments or defaults
- The age and severity of past credit issues
- Whether your credit behaviour has improved
- Your loan-to-value (LTV) ratio (how much you owe compared to the property’s value)
Even if you’ve had issues before, showing 12 months of steady payments can make a huge difference. Lenders want to see progress — not perfection.
Can You Switch to a Better Rate with Bad Credit?
Yes, though your rate may depend on how recent your credit issues are.
- If problems were over two years ago: Many lenders will offer competitive rates.
- If issues are recent: You may still qualify, but rates could be higher initially.
- After six to twelve months of clean credit: You can often remortgage again later for a better deal.
We often help clients switch from a high variable rate with their current lender to a better fixed deal — even when their credit isn’t yet spotless.
What Are the Alternatives If You Can’t Switch Lenders?
If you can’t switch right now, you still have options:
- Product Transfer: Stay with your current lender but move to a new deal. This often requires less credit checking.
- Wait and Rebuild: Take 6–12 months to improve your credit score, then reapply.
- Add a Joint Applicant: If your partner has stronger credit, applying together can help.
- Work with a Specialist Broker: We can find lenders open to your circumstances.
Even if switching today isn’t ideal, we’ll help you plan ahead — so when the time’s right, your application is stronger.
How to Prepare Before Switching Mortgage Lenders with Bad Credit
Here’s how to give yourself the best possible chance of success:
✅ Check your credit report on all three agencies.
✅ Pay every bill on time for at least six months.
✅ Avoid new credit applications just before remortgaging.
✅ Reduce existing debts where possible.
✅ Gather key documents — payslips, bank statements, and proof of ID.
A broker who understands how to present bad credit mortgage cases can highlight your strengths and explain any past issues in the right way. That’s exactly what we do at Mortgage Bridge.
Can You Switch Lenders While in a Debt Management Plan or IVA?
Yes, but with limitations. Most high-street lenders won’t approve an application during an active DMP or IVA, but specialist lenders may still consider it — especially if your plan is nearly complete and your payments have been consistent.
If you’ve finished your arrangement, you’ll have far more choice. We discuss this in more detail in our guide on getting a mortgage after a DMP or IVA.
Will Your Current Lender Let You Switch Internally?
Many lenders offer product transfers, letting you stay with them on a new deal without full credit checks. This can be ideal if your credit score has dropped since your last mortgage.
If that’s an option, we’ll compare whether it’s better to stay put or switch to another lender. Sometimes the difference in rates can save hundreds per month — even with bad credit.
Final Thoughts: Switching Lenders with Bad Credit Is Possible
Having bad credit doesn’t mean you’re stuck with your current mortgage forever. You can still switch mortgage lenders with bad credit — it just takes the right strategy, preparation, and lender match.
Whether you want to reduce monthly payments, secure a new fixed rate, or release equity, we’ll help you find a solution that fits your circumstances.
If you’d like tailored advice, let’s explore your options together.