Mortgage with CCJs
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Mortgage With CCJs
A County Court Judgement is where after a period of missed payments, the company that provided you with your credit decides to take you to court to have the fact that you haven’t paid registered on your credit file.
It is largely an administrative action as at this point this is not an enforcement of making the payment of the debt, however it is the first step towards that should the company wish to take it further.
Which is where you then appear on certain tv programs with bailiffs at your door after the company has applied to the high court for a court order!
Can I Get A Mortgage With a CCJ?
Even if you have a county court judgement it doesn’t automatically rule you out of getting a mortgage but it certainly makes it more difficult than for someone who has a clear credit history.
With mortgage lenders, whether they accept or you not will come down to each lenders individual criteria and they are looking at three key pieces of information.
When was the CCJ registered? What is the Value of the CCJ? Is the CCJ satisfied or unsatisfied?
The answer to these questions will determine which mortgage lender could potentially help you as well as how much deposit you will need to make your dream of buying a home possible.
When you have had credit issues in the past working with a mortgage broker like ourselves can make your life less stressful due to us knowing the marketplace, knowing which mortgage provider could help you and aim to make your application process as smooth as possible.
Having More Than One County Court Judgement
If you have more than one CCJ on your credit report again it doesn’t automatically rule you out of a mortgage, there are some lenders that can consider this type of situation but from a lender perspective it will fall under what they consider poor credit history.
This just means that you could need a bigger deposit and you will likely be paying much higher interest rates then someone with a clean credit history.
What is a Satisfied CCJ?
If you have a “Satisfied CCJ” this means that the CCJ has been registered on your credit file but you have since paid the debt so you no longer owe the money.
Is It Easier To Get a Mortgage With a Satisfied CCJ?
Getting a mortgage with a satisfied County Court Judgement isn’t necessarily any easier to get then if the mortgage was unsatisfied. It is true that some lenders within their criteria state they want the county court judgment to be satisfied.
Just the fact that you had the CCJ makes the biggest difference in getting a mortgage or not and if you haven’t satisfied the judgement there are still some lenders that can consider lending to you.
What is an Unsatisfied CCJ?
If your CCJ is unsatisfied then this means that the CCJ is registered on your credit report but you still haven’t paid the debt off so you still owe it to the company
Credit File/Credit Report
All of the information surrounding your CCJs can be found on your credit file so when speaking to a mortgage advisor when you let them know that you’ve had some poor credit in the past it’s likely we would just request a copy of your credit report so that way we can see exactly what a lender will see and know very quickly which mortgage deal would be the right one for you.
There are three main credit reference agencies, these are Experian, Equifax and Transunion and you could obtain a copy of your credit report from any these.
We recommend using Check My File though as it provides all three of the reports in one easy to read place and means we can see everything without having to download all three.
What Credit Rating Do I Need For a Mortgage?
There is no specific credit score/rating that you have to have to be eligible for a mortgage as the score provided by each credit agency is specific to them and their own internal algorithm.
It’s not even something a lender would see when they do a credit check. The most important thing is what the credit report contains around values and dates as discussed above.
What Mortgage Lenders Will I Be Able To Use?
This is a bit of a difficult one as there are a lot of potential lenders and each lender has their own eligibility criteria so without knowing an individual situation there is no catch all statement.
What we can say is that most high street lenders would prefer for there to be no CCJs on the credit file at all but there could be some flexibility in the right situation.
Specialist lenders are much more accustomed to having mortgages available for those that do have CCJs but if you are new to mortgages it’s unlikely you will be able to find all of the specialist lenders that could help you with a google search!
Working with a mortgage advisor gives you the best chance of getting your mortgage application approved.
How Much Deposit Will I Need?
The more recently registered CCJ, higher value or multiple CCJs are all likely to mean that you would need to be working with a larger deposit than 5% or 10%.
This is due to a lender viewing you as being higher risk as effectively a CCJ is a company registering on your credit report that you haven’t paid your debts back before.
The further away your adverse credit history the better it is for you and if you’ve built your credit report up since you had the CCJ then you could make yourself a less risky prospect and not need as substantial deposit as someone who hasn’t improved their credit or just recently had a CCJ.
What Is a CCJ Mortgage?
In reality there is no such thing as CCJ mortgages there are just specialist lenders that understand people can experience credit issues in their lifetime and have mortgage products designed to help.
However due to regulation it would not be possible for a mortgage lender to focus solely on those with credit problems as overall that would make the lender too risky and likely to fail.
When you look at specialist lenders they design their mortgages to help a wide variety of situations and it may even be that someone with credit problems in the past would end up on the same mortgage as maybe someone with an unusual employment situation or buying an unusual property.
This is why talking to a mortgage advisor can make sure that your mortgage application goes to the right place getting you approved and peace of mind.
What Are The Biggest Differences with Getting a Mortgage with a CCJ?
Ultimately the key differences that you would see if you were trying to get a mortgage with a CCJ would be;
Lender – Most lenders found on the high street are unlikely to consider one or more CCJs so you may end up with a more specialist lender. More lenders are understanding people having a poor credit status but there is a lot of work still to be done by other lenders
Interest rate – The interest rate that you will pay is likely to be higher than a more mainstream lender due to them being more specialist and designed to help unusual situations as opposed to competing with interest rates.
Deposit – Depending on your situation it could be that you require a larger deposit than someone with clean credit file that could look at 5% or 10% mortgages.