Best Mortgage Lenders for Bad Credit

Having a poor credit history doesn’t mean you can’t get a mortgage — it just means you may need the right help to find the best mortgage lenders for bad credit.

Many people have had financial setbacks at some point — missed payments, defaults, or even a County Court Judgment (CCJ). The good news is that there are lenders who specialise in helping people rebuild and move forward.

At Mortgage Bridge, we work with a wide range of lenders — from high street names to specialist providers — to help clients with bad credit secure the right deal for their circumstances.

Here’s what you need to know.

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What Does “Bad Credit” Mean to Lenders?

Bad credit simply means that your credit report shows past financial difficulties. These could include:

• Missed or late payments
• Defaults or arrears
• CCJs (County Court Judgments)
• Debt Management Plans (DMPs)
• IVAs or bankruptcy

Each lender has their own view of what counts as “bad credit.” Some will accept minor issues like a single late payment; others specialise in helping people with more serious past credit events.

💡 Tip: Always check your full credit file using a multi-agency report from Checkmyfile. It combines data from Experian, Equifax, TransUnion, and Crediva to give the clearest picture.

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Can You Get a Mortgage with Bad Credit?

Yes — absolutely. Many of our clients at Mortgage Bridge have secured mortgages despite having previous credit challenges.

What matters most is:

• How long ago the issue occurred
• Whether the debt was repaid or settled
• How you’ve managed your finances since
• The size of your deposit and your current affordability

The more time that has passed since the credit issue, the more options you’ll likely have.

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Types of Lenders That Accept Bad Credit

Lenders generally fall into three categories:

1. High Street Banks

Some high street lenders may still accept you if your credit issues were small or occurred several years ago. However, they usually have strict criteria and may require a higher credit score or larger deposit.

2. Building Societies

Many building societies take a more personal approach and review cases individually. They may accept mild or older credit issues, particularly if you can show financial stability and a good explanation.

3. Specialist Bad Credit Lenders

These lenders are designed for applicants with more significant or recent issues, such as defaults, DMPs, or CCJs. They often assess your overall affordability and recovery rather than focusing only on your past.

💡 Example lenders include:

• Pepper Money
• Kensington Mortgages
• Bluestone
• Aldermore
• Precise Mortgages
• The Mortgage Lender
• Together Money

(Note: Lender availability may change depending on your individual circumstances and market conditions.)

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What Do Bad Credit Lenders Look For?

Each lender’s approach is different, but most will assess the following:

1. The age and severity of credit issues – Older or smaller defaults are viewed more leniently.
2. Deposit size – Larger deposits (typically 15–25%) increase your approval chances.
3. Income and affordability – Proving stable income and low debt-to-income ratio helps.
4. Property type and value – Lenders prefer standard properties in good condition.
5. Recent financial behaviour – Regular payments and no new defaults signal improvement.

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How Much Deposit Will You Need?

Your deposit plays a major role in what lenders are willing to offer.

Credit Situation	Typical Deposit Required
Minor issues (late payments, old defaults)	5–10%
Recent defaults or CCJs	15–25%
Active DMP or IVA	20%+

💡 Tip: Even if you can only start small, improving your credit and saving over time opens up more competitive options later — especially when you remortgage.

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Example: Mortgage Approval After Defaults

A Mortgage Bridge client had two defaults from three years ago after job loss. Despite this, they had since rebuilt their credit, maintained regular payments, and saved a 15% deposit.

We approached a specialist lender who reviewed their case manually and approved their mortgage within three weeks.

That’s the difference between going direct and working with a broker who understands which lenders to approach.

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Why Using a Mortgage Broker Matters

Finding the best mortgage lenders for bad credit isn’t just about comparing interest rates — it’s about knowing which lenders will accept your unique situation.

At Mortgage Bridge, we:

• Review your credit file in detail
• Match you with lenders who fit your profile
• Present your application clearly and accurately
• Handle all communication and paperwork

This tailored approach helps prevent unnecessary declines and increases your chances of approval.

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How to Improve Your Credit Before Applying

Even small improvements can make a big difference:

1. Check your credit report regularly for errors or outdated data.
2. Register on the electoral roll at your current address.
3. Pay all bills on time for at least six months.
4. Reduce credit utilisation — aim to use less than half your available limit.
5. Avoid new credit applications before applying for a mortgage.

💡 We cover this in more detail in our guide on improving your credit before applying for a mortgage.

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What Interest Rates Can You Expect?

Rates for bad credit mortgages are typically higher than standard deals, but they vary depending on the lender and your credit profile.

Profile Example	Typical Rate Range (Approx.)
Minor issues (over 2 years old)	5–6%
Moderate issues (defaults or CCJs within 2 years)	6–7%
Active DMP or IVA	7–8%

As your credit improves, you can remortgage to a lower rate in the future — something Mortgage Bridge can help you plan for.

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Final Thoughts

Finding the best mortgage lenders for bad credit is possible with the right guidance. Many specialist lenders look beyond your past to focus on your current situation and affordability.

At Mortgage Bridge, we help you understand your options, prepare your application, and secure a deal that works for your goals — even if you’ve had credit challenges in the past.

If you’re ready to take the next step, we’re here to help you find your best way forward.

Let’s explore your options together.