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Recently in the UK there seem to have been a lot of changes with how mortgages work, especially with the introduction of the "help-to-buy" schemes. Whilst looking around a few sites (both .gov and individual banks) I see no mention of credit history or ratings in the advice given for mortgages.


Q: Is credit history a main factor in a mortgage application in the UK, and either way - what specific impact does credit history have on an application?


I have asked this whilst in the bank on a couple of occasions, but do not seem to get a straight answer.

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Source

You must have a good credit rating (see below) and cannot apply for a Help to Buy mortgage if you have overdue amounts equivalent to three months’ payments on a mortgage or other loan in the past two years, one or more county court judgments, with a total value greater than £500, within three years of the completion date or an individual voluntary arrangement or bankruptcy order which was in force at any time in the past three years.

Frankly speaking a bad credit history shuts off most of the places where you can get a credit i.e.jobs, banks etc. So for a mortgage you need to have a good credit. The banks are going to do a full credit check before they give you a mortgage. Did you check with a mortgage adviser at a bank ? He/she would have been able to give you a clean answer. So would if you call the mortgage helpline of a bank.

A good credit history, but spending beyond your means will also raise red flags for the bank. They ask for your spending habits to decide if you will be able to keep up with your mortgage payments. If they see you are a habitual spender they might refuse you. That is where the credit check helps them. They see your credit card bills and payments or to check how much you are on overdraft.

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  • I did speak to a mortgage adviser on 2 separate occasions, but they seemed more interested in taking me though a calculator and telling me what I could get if I had x amount for a deposit than answering my questions about credit history. I ask because I have a CCJ for about £200 caused by a dispute - it's been paid off but only after the CCJ was issued. – SierraOscar Nov 17 '15 at 17:06
  • Did you put your CCJ upfront to them ? If no then mention it to them upfront. Yes that is what they do, but next time tell them you will talk about the mortgage only after they confirm if the CCJ will hamper you getting a mortgage from them. Don't hide it from them as it willn't help them in giving you a proper picture. Check here trustonline.org.uk/understand-judgments-fines/… – DumbCoder Nov 17 '15 at 17:09
  • Yes the adviser was aware as that's what prompted the discussion in the first place - it sounds more and more like I just got a "bad egg" so I'll perhaps go to a couple more banks and ask around. Thanks for the advice. – SierraOscar Nov 17 '15 at 17:11

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