First-Time Buyer Mortgage with CCJs

Does the value or number of CCJs affect my chances of being approved for a mortgage as a first-time buyer?

Definitely. A history of CCJs following one after another is a trigger to a lender. They will assume there was a problem at that point in time. Can this person manage their finances?

The more CCJs there are, the more the lenders will look into it. Having more CCJs will reduce the number of lenders we can approach.

Are government schemes available to help first-time buyers who have CCJs?

As far as I’m aware, there are no specific government schemes like this. It’s very much down to individual lenders to decide on whether to accept somebody with a history of CCJs.

Will I need a bigger deposit for a mortgage as a first-time buyer because of my credit history with CCJs?

It all depends on the key factors. How large was the CCJ? How long ago was it? Was there a good reason for it? How much deposit are you putting in now?

You can actually get a mortgage with a standard 5% deposit – a 95% mortgage – with a CCJ in the background, even with a mainstream lender.

It will all come down to the size, the timing and how good your credit score is now. But it’s possible you might get away with a 5% deposit.

Will I have to pay a higher interest rate as a first-time buyer because of my CCJs?

Probably, yes. But if your credit score is otherwise good and the CCJ is older, you may get a mainstream lender – and therefore not pay a higher interest rate. Otherwise, potentially yes.

Can I remortgage later to get a better deal once my credit improves?

Yes, which is really good news. You might end up on a slightly higher interest rate initially because of the credit history and the CCJ.

But over time your credit profile will improve – and your new mortgage will help with that, as long as you keep those payments up-to-date. We should then be able to remortgage you onto a better product at the next review.

Can I improve my chances by applying for a mortgage with a guarantor or a co-applicant?

The likelihood is yes – because you’re bringing that guarantor or co-applicant in as a support mechanism. Provided they’re in a better situation, that can strengthen your application and give the lender more confidence to accept it.

How can a mortgage broker help me with my first-time buyer mortgage application? Any final thoughts?

When there are CCJs or some elements of adverse credit in the background, a lot depends on the size, how long ago it happened and how much risk there is to the lender now – which is essentially how much deposit or equity is going in.

The best way to decipher these things is by speaking to someone who deals with this on a day-to-day basis. We’re here to help you find the right solutions.

You could find a product yourself – but it may not be the right one. Part of our job is to find the lowest cost solution for you and save you money.

Key Takeaways:

• It is possible to get a mortgage as a first-time buyer with County Court Judgments (CCJs), especially if the CCJ is settled.
• CCJs do not necessarily need to be paid off, but settling them significantly improves the situation.
• The age, size, and reason for the CCJ, as well as the size of the deposit, are all factors lenders consider.
• While a higher interest rate is possible, a strong credit score and an older CCJ might still allow for a mainstream lender.
• Applying with a guarantor or co-applicant can strengthen the application, and a mortgage broker can help find solutions for those with adverse credit.
  
  

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.