No Deposit Mortgage Information When You Have Bad Credit

Getting a mortgage without a deposit is already challenging in the current market, and having bad credit can add further complexity. However, in certain circumstances, routes may still exist. Outcomes usually depend on the type of credit issues involved, how recent they are, income stability, and whether additional support is available through family assistance or specific schemes.

Mortgage Bridge provides clear information to help you understand how no-deposit or low-deposit scenarios are commonly assessed by lenders where bad credit is present. Where appropriate, we can introduce you to an FCA-regulated mortgage adviser who can provide regulated advice.

Can you get a mortgage with no deposit and bad credit?

It can be possible, but options are usually limited.

Most lenders offering high loan-to-value mortgages expect clean or only lightly impaired credit. Where bad credit is involved, achieving a true no-deposit purchase often relies on one or more of the following:

  • Support from a family member using savings or property

  • A scheme that reduces the deposit requirement

  • Older, low-value adverse credit

  • Strong and stable income with good recent conduct

While true 100% mortgages are rare, there are routes that can effectively reduce or replace the need for a traditional cash deposit.

No deposit and bad credit: common routes lenders may consider

1. Family-assisted options

These are often the most realistic routes where bad credit and no deposit are combined.

Savings-backed arrangements
A family member provides savings that act as security for a period of time. These funds may be returned after a set number of years if the mortgage is maintained as agreed.

Support secured on family property
A portion of a family member’s property may be used as additional security instead of a cash deposit, subject to lender criteria.

Availability depends on the lender and requires regulated advice.

2. Reduced-deposit purchase options

Where a true no-deposit mortgage is not possible, some options may reduce the deposit required.

Shared ownership
Lower deposits are sometimes accepted, even where credit history is not perfect, depending on circumstances.

Discounted purchase schemes
In some areas, schemes offering discounted property prices can reduce the effective deposit required.

Right to Buy
For eligible council tenants, the discount can sometimes be used in place of a cash deposit. This has historically been more flexible for applicants with adverse credit.

3. Joint or supported applications

In some cases, a relative with a stronger financial profile may help support an application through joint or supported arrangements, depending on lender rules.

4. Older adverse credit

Options are generally wider where credit issues are:

  • Defaults over 2 years old

  • CCJs over 3 years old

  • Fully settled

  • Isolated rather than repeated

Many lenders place greater weight on recent behaviour than historic issues.

How lenders typically assess no-deposit cases with bad credit

Although criteria vary, lenders often focus on:

1. Affordability and income stability

Stable income and clean recent bank statements are especially important where deposits are low.

2. Type of credit issues

Utility or telecom-related issues are often viewed more leniently than credit card or loan defaults.

3. Age and number of adverse items

Older or settled issues are generally treated more flexibly than recent or ongoing problems.

4. Overall stability

Lenders value predictable income, long-term employment or trading history, and clear monthly commitments.

Steps that may help before applying

Steps that may strengthen a profile include:

  • Obtaining a full multi-agency credit report

  • Keeping recent bank statements clean and consistent

  • Settling smaller defaults or arrears where affordable

  • Avoiding unarranged overdrafts

  • Keeping credit card balances below around 50% of limits

  • Providing clear evidence of stable income

These factors help lenders assess whether repayments are likely to be sustainable.

How Mortgage Bridge supports you

Mortgage Bridge provides information to help you understand how no-deposit and low-deposit scenarios are commonly assessed where bad credit is involved. We do not provide mortgage advice or recommend lenders.

Where appropriate, we can introduce you to an FCA-regulated mortgage adviser who can review your circumstances in detail and provide regulated mortgage advice.

Next steps

If you have bad credit and little or no deposit and want a clearer understanding of what may be possible, Mortgage Bridge can provide information and, where appropriate, introduce you to an FCA-regulated mortgage adviser.

As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.

Related Guides

Explore more advice that may help your situation.

Low Credit Score Guides

See how low scores interact with smaller deposits in lender decisions.

Credit Repair Guides

Steps to improve your credit position if deposit funds are limited.

Joint Applications (Bad Credit)

Learn how things work when applying with a partner who has stronger credit.

Important information: Mortgage Bridge provides information only and acts as a mortgage introducer. We do not provide mortgage advice or make lender recommendations. We can introduce you to an FCA-regulated mortgage adviser who can provide personalised mortgage advice.