Can I buy a house in the future if I have really bad credit now?

14 comments

1. A friend did all that and went bankrupt and now has a house etc. Go to your local citizens advice for help to get your debits in a row

2. Decent. Banks want people to have mortgages because they’re secured debt, i.e. if you can’t pay then they just keep and sell your house. And if you do pay, they make a tonne of money off you.

   If you come to buy a house in five years time and have a clean record within that time, they’re not going to care about stuff in the distant past.

3. banks love secure debt. if you don’t pay they have an asset they can sell to recoup their costs. if you pay they make money from you. the more money you put down the better offers you’ll get and also the easier time you will have getting a mortgage.

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   you start getting the really good deals when your loan to value drops to the 50% mark.

4. I had a default and a trashed credit score and I have a house now. Took a few years to rebuild the credit score. It’s all fixable OP.

5. 20 years ago I was in over £25k debt spent 10 years on a debt management plan with step change to clear it all. Since then never been over drawn, have £20k plus credit available on cards and any spends on that cleared in full each month and bought a flat 5 years ago. It can be done.

6. My husband had very bad credit before we met, so around 13 years ago and we’ve just bought a house. His score is actually better than mine and I’ve never missed a payment 😂 Our broker said it gets wiped after 10 years (I think).

7. I made all sorts of bad decisions in my youth, am not really sure when it got forgotten but it seems to have, i never took any advice but I thought that if I built up enough evidence of good credit that would disguise the previous bad credit, and it must have worked as I have a mortgage.

8. Specialist Lenders will look at this and the rate/deposit required depends on when the CCJs where registered.

   With CCJs you will get the best rates from them if you have had none registered in the last 24 months but they do have products for people with 3 registered in that term.

   Your best bet is to ensure that you make payments on all the debt etc you currently have with direct debits set up for everything. Based upon criteria the now you are looking at a 15% deposit but with everything no guarantee you will be accepted.

9. If you pay your debts and save for a couple of years you should be able to get a mortgage through a broker. It won’t have a good rate but beggars can’t be choosers.

10. Yes you can, but it will make it harder. Some lenders won’t even look at applicants with bad credit scores. Some will, if they are prepared to look more deeply at the reasons for the score, the current situation, the future income and so on. However any mortgage offer they make will likely have a lower loan to value ratio (meaning you have to find a higher % deposit) and/or a higher interest rate.

    You should read up on how credit scores are compiled. The ccjs are very bad for your score but the debts generally aren’t, providing you repay them on time. Delays in repayment will affect your score negatively.

    Most negative items drop out of the credit score after six years. So if you can stay clean for that time, you may be able to get a regular mortgage at regular rates. You don’t have to be debt-free during that period, but you do have to make scheduled debt repayments on time.

11. Six years after your most recent CCJ, it will be off your records.
    I built myself from having the most terrible credit rating that meant I could only get a zero balance credit card (i.e. I could put money on it, *then* spend it), to where I am now, which is homeowner with just shy of Excellent credit. I was at my low when I got that CCJ, by the time I got it off my records, the rest of my finances were in OK shape too.

    Saving up the deposit is another matter; when I bought my house a few years ago, it was worth £80,000 and they wanted me to have 5% of that, so about £4000. Right now, my house is worth £130,000, so you’d need more like £6,500 saved to buy it now.

    So what I guess I would say is, if you are now in a good place to start saving about that much money, and can spend the next 6 years building your credit score, by the time you get the CCJ of your record, you could be in a place to buy a house.

12. It’s not impossible, but you need to sort your finances out and get your credit scores up again.

13. I had a terrible credit rating in my late teens and early twenties as I got into needless debt and then missed payments. I got myself out of it after a few years and now my credit rating is excellent. It can be done but it does take time.

14. Yeah, you can.

    I had a monstrous heroin habit for a decade and took out pay day loans on top of my wages, then told them to fuck off when they came for the money. I ran up mobile phone debts, credit cards, loans, etc. It was mess.

    Fast forward more than six years, it’s all wiped and my credit’s back to good standing. I have a contract phone, credit cards, and a mortgage. It’s not impossible, but you do need to wait six years until it’s all wiped.

    My advice? Don’t go bankrupt, speak to creditors. I called them and said ‘I’m a heroin addict, I don’t have the money, I can pay £5 a month or you’ll get nothing’ – they always took the £5. Creditors can’t be arsed to go to court and have to take reasonable repayments, so phone them and discuss it.

    If you have pay day loan debt, fuck that off straight away. They won’t take you to court, they’ll just try to bully you by constantly calling you – block and ignore. They won’t go to court as judges don’t like them and will instantly wipe it. Ignore them or offer £5 a month.