Limited Company Mortgage Bad Credit
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Limited Company Mortgage Bad Credit
Can I get a mortgage through my limited company if I have bad credit? How will bad credit affect my ability to get a mortgage?
It is possible to get a Limited Company mortgage where there is bad credit involved. Overcoming that challenge of bad credit to obtain a mortgage can really depend on the level of adverse credit, and when it was registered.
For example, if a county court judgement (CCJ) was recently registered, you may need to wait six months. With any adverse credit element involved, it’s best to speak with an advisor. Talk to us here at Smith’s Financial – we can look at your credit report and advise accordingly.
What is considered bad credit in the UK?
One example is County Court Judgements. With a recent CCJ you may find that you’re paying a higher rate than with a one registered over three years ago.
More lenders do become available once the adverse credit is over three years old, but we do have lenders available for all circumstances. If you were to satisfy a CCJ or other debt, that can also help, and some lenders take this into account with the affordability – especially if there is a payment plan in place.
What is an individual voluntary agreement (IVA)?
IVA’s generally stay on your credit file for six years, and lenders generally would require a set amount of time to pass since being discharged – after the IVA is paid off. Some lenders prefer to wait two or three years after the discharge date, whereas other lenders are fine with the IVA no longer showing on the credit report.
It can all be subject to credit scoring with the lender, though. When you meet with us here at Smiths Financial, we’ll review your credit report with you and discuss the best steps towards getting a Limited Company mortgage.
What is a default?
When reviewing mortgage options for our clients, we look at the credit report to see when any defaults were registered and when they will fall off the credit report. It’s part of our research into which lenders would be available. Some lenders may want three years to have passed after a default, or perhaps 12 months since a default was satisfied.
They may also want a bigger deposit. Some lenders do accept unsatisfied defaults, and some will disregard defaults entirely – especially those with utility companies or communication suppliers.
If you do have a default on your credit report, it’s still possible to get a mortgage – so it’s worth us reviewing your credit report. We’ll see which lenders suit your requirements.
What is a debt management plan (DMP)?
Debt management plans are acceptable for some lenders and unacceptable to others.
When we review your credit report as part of our research, we’ll see which lenders will take a positive view on your debt management plan.
Some lenders may want evidence that the debt management plan has been satisfactorily complied with. The lenders usually ask for proof of 12 month payments. If you receive monthly statements, it’s worth holding on to them as proof.
Some lenders will even consider a DMP 12 months after it has been satisfied. Each lender has individual criteria regarding this, so it’s worth having a chat with us to see what’s possible for you.
Are there other types of bad credit?
There are multiple versions of bad credit, including late payments and arrears on secured lending – such as on an existing mortgage.
Our approach is to look at the credit report and research which lender might be the right one for you. So get in touch and we’ll advise you accordingly.
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Are there specific lenders who specialise in mortgages via limited companies with bad credit?
Every lender has criteria around what they accept, when it comes to bad credit. We can help by researching the right lender for you based on the specifics.
There are set products for adverse credit, which can vary depending on when the event was registered. Due to the limited company element, lenders tend to want a 25% deposit, as it’s likely to be a Buy to Let mortgage.
There may be some options available with a 20% deposit, but give us a call and we can discuss this further.
Can I still get a mortgage through my limited company if I’ve had previous bankruptcy or repossession?
It depends on how much time has passed since this has occurred. We can research this for you. Some lenders are fine with previous bankruptcy, however they may wish to wait 2-3 years since the bankruptcy was discharged.
Generally, you have more options three years on from the discharge of the bankruptcy, but some lenders will accept less time. Others could be longer than three years.
It can also be influenced by the amount of deposit you have available, as that obviously affects the Loan to Value ratio. Get in touch – we’ll review the circumstances and see which lenders might be available for you.
What if I’ve previously been declined for a mortgage through my limited company with bad credit?
As part of our process, we’ll look at why that may have happened and advise accordingly. There may still be a lender out there for you – or you may need to take some steps before you reapply.
Don’t give up at the first hurdle. You can always try again.
What if I’m a First Time Buyer and have bad credit? Will this affect me getting a mortgage through a limited company?
Yes – if you’re a First Time Buyer with adverse credit, it’s still possible to to get a mortgage through a Limited Company.
Again, it all depends on when the bad credit occurred and whether there are any amounts outstanding, such as unsatisfied defaults or CCJs.
Reach out to us here at Smiths Financial and we’ll review the circumstances. We’ll work with you to achieve your requirements in purchasing a property. We’ll look at your credit report and conduct an affordability assessment with the lenders that may be able to help.
Can you remortgage via a limited company with bad credit?
Yes, it is possible to get a remortgage via a Limited Company with bad credit. We would look at your credit report with you and conduct an affordability assessment with the lenders that may be able to help based on your credit situation.
We work with you to achieve the best possible outcome for your mortgage needs.
Can I get a Buy to Let mortgage via a limited company with bad credit?
Yes, again, it’s similar to a remortgage. We would look at your credit report with you, and conduct an assessment with suitable Buy to Let lenders for a Limited Company.
With a Buy to Let mortgage, it’s worth mentioning that the anticipated rental amount will also be taken into consideration for the loan amount the lenders will offer you.
How can a mortgage broker help? Have you got anything else to add?
When you download your credit report and you’re seeing things for the first time, it can be a bit daunting and scary. How are you going to be able to get a mortgage with this default or CCJ on your credit report?
It’s definitely helpful to have a broker by your side. Our role is to put you in the best possible light in front of the lender. We’ll work with both the lender and yourself to achieve a successful positive outcome.
With adverse credit, there’s a lot of research involved, and liaising with the lender about a client’s situation. We would work to give you the best possible deal that’s available.
If you do have adverse credit or there’s anything you’re unsure about, reach out to us here at Smiths Financial and we’ll look at how to achieve your goals.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE MOST BUY TO LET MORTGAGES.