What is a credit score?
A credit score is a number generated by a mathematical model that represents your credit history. Lenders will use your credit report and any other financial information provided on your application to generate this score. Your score will then be used to determine whether or not you will qualify for a loan – in this case a mortgage. The score is used as an idea of the likelihood of you paying back the loan.
Your credit score can be affected by a number of things. These include:
- The amount of available credit you are using
- The total amount of debts you have
- Your historical credit account payments/repayments
- Public records – CCJs, defaults, bankruptcy
Having a bad/low credit score can seriously impact the likelihood of lenders approving loans you apply for, whether that be a mortgage, a credit card, etc. If you have a bad credit score, you may be perceived as a higher risk to a lender, as you could be deemed unable to make or, untrustworthy with, repayments. It is worth speaking to an adviser before you apply for a mortgage (or any other loan) if you have queries about your credit score, as it can vary from lender to lender whether they will be willing to accept particular numbers or not. Call us today on 0333 320 8658 for some more information.
Can you still get a mortgage with a low credit score?
As previously mentioned, it can reduce your chances of getting a mortgage if you have a poor credit score. However, it is not impossible to do so.
To begin with, you should visit or contact a mortgage adviser. Here at View Finance, we specialise in helping those with bad credit, so don’t hesitate to contact us today.
Your adviser will look around for the best lender for your case, and will help you to compare prices. If, unfortunately, no lenders are willing to accept you as a borrower, your adviser will explain what you can do in order to show your financial abilities in a better light, so as to prove to lenders that you are responsible.
Some helpful tips you can follow are:
- Show lenders that you can meet all of your regular payments in full and on time. These could be for example, utility bills. This will show you are responsible with your money.
- Review and reduce your costs. Aim to budget similarly and consistently from month to month, leaving some left to carry over into the next month. This not only proves to lenders you have good money management skills, but will also potentially relieve some strain from you financially, as you won’t be worrying about the money running out.
- Keep on top of your credit report. Check it regularly and make sure all the information is correct.
- Be realistic with your borrowing. With your mortgage, find a home you can actually afford to make repayments on. You can make any house a home, so don’t give yourself additional stress by making affordability a problem.
Obviously, some of this is easier said than done, but having an adviser to help you out with tricky questions and confusing situations can be a big weight off your shoulders. Contact us at View Finance today on 0333 320 8658, or send us an email to info@viewfinance.co.uk.
