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Mortgage After Late Payments

How To Get a Mortgage After Late Payments

Mortgage After Late Payments

Worried about getting a mortgage with late payments on your credit report?
Many lenders may decline applicants due to recent late payments or a low credit score (which late payments can cause). But the good news is that getting a mortgage with late payments is possible, as there are specialist lenders happy to consider borrowers with late payments on their credit history. With access to the whole UK market, our dedicated team here at Amber Mortgage Solutions can help you to find them.

For more information

Speak to our specialist advisers today.

01702 619 221

What Is The Difference Between Missed And Late Payments?

A missed payment is when you fail to pay one or more scheduled payments entirely, whereas a late payment is a payment made after the due date has passed.

A record of a late payment will show on your credit report with a ‘1’ next to it, showing that the payment arrived one month late. As more payments are missed, this number will increase to show the number of months that a payment has been left outstanding. However, once the payment has been made this number will freeze.

Whilst a payment that is paid a couple of days or even weeks late may not be recorded on your credit report, it is not worth risking late payments. So if you’re serious about securing a mortgage with late payment history, take care to always make your payments on time and remember to allow at least three working days for payments to be received and processed.

What Are My Chances Of Mortgage Approval With Late Payments?

There is no doubt that late payments on your credit file can affect your mortgage application. When assessing your application, lenders will look at your credit file to determine whether or not you’re capable of managing your money and are a credit worthy applicant. Late payments are red flags to lenders and suggest that you’ll be unable to make your mortgage repayments on time. Even if a lender does decide to accept your application, you may still come up against higher rates of interest and be required to put down a bigger deposit.

Lenders have the outlook that your finances are your responsibility. So, even if you believe that a late payment wasn’t your fault – for example, you paid a bill late because you didn’t receive your statement on time – it is up to you to regularly check your account and contact creditors to correct any mistakes.

Here’s what our client’s have to say!

How Long Should I Wait To Apply For a New Mortgage After Late Payments?

Late payments will remain on your credit report for six years. This means that for those six years your chances of securing a competitive mortgage deal are potentially going to be affected.

Typically, the older your late payments, the less of an impact they’ll come to have on your mortgage application. For example, if you were to have one or two missed payments in the last six years, whilst this wouldn’t necessarily mean that your application will be declined, it might mean that your offer will come with a request for a higher deposit or with a higher rate of interest.

Multiple missed payments or new missed payments in the past twelve months are likely to have a far bigger impact on your application.

It is important to remember that whilst late payments can affect your chances of mortgage approval, you do not have to wait until late payments are gone from your record before you can apply for a mortgage. Our experienced bad credit advisors have access to specialist lenders who will be happy to look at your application and find you deals to suit your individual circumstances.

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What Happens When You Miss a Payment?

The first thing that happens when you miss a payment, is the lender will let the credit reference agencies know. The amount of time between when the payment is missed and when the account is brought up to date is then registered by these agencies, leaving the number of months that the amount was unpaid visible on your credit report. It is this record that will then go on to have an impact on any of your future mortgage applications.

If you miss a payment on a loan, such as a mortgage or a car, then these may be repossessed. Or, if you miss a payment on a credit card, then your card will be frozen until you’re back up to date with your payments.

Missed Or Late Mortgage Payments

Late or missed mortgage payments are considered to be very serious and some lenders may see these as an indication of severe financial trouble.

If you have fallen behind with mortgage payments in the past but are now up-to-date, then your overall credit rating since is going to be important to whether or not your application is accepted. However if you’re currently still behind on your mortgage payments, then it is highly unlikely that you’ll be approved for any remortgage deal.

Whatever your current situation may be, you can speak with one of our specialist advisors today for expert and friendly advice on the best options available to you.

What Can I Do To Repair Credit Late Mortgage Payments?

Want to improve your chances of being approved for a mortgage?
There are several things you can do to start repairing your bad credit history and gain the approval you need for a mortgage.

The first step is to check your credit report. Copies of this report can be obtained for free, from a wide range of trusted online providers. Next, you will need to check that all information on your report is correct. If you find any mistakes or any records of bad credit that shouldn’t be there, for example, a missed payment that you were unaware of, then you will need to get in contact with the agency and have this amended.

If there are any records of late payments on your file that you feel were a result of circumstances outside of your control – bereavement, sudden illness or unexpectedly losing your job – then it is worth contacting the agencies concerned to see if they will add a note of correction to your file.

The next step is to rebuild your credit history. Going forward, try to demonstrate that you are able to pay your financial commitments on time. Avoid mortgage late payment charges and bad credit incidents of any kind. Another thing you can do is start saving for a good sized deposit. With missed or late payments on your credit report, it’s more likely that lenders will offer you a smaller loan-to-value (LTV) ratio. The LTV is the amount of the purchase price of a property that a lending is willing to offer you. So, the larger the deposit you’re able to put down, the better the deal lenders will be able to offer you.

Seek Specialist Mortgage After Late Payments Advice

Have high street lenders turned you down when applying for a mortgage with late payments on your credit report? Then speak with one of our specialist mortgage brokers today.

Our knowledge and experience of bad credit mortgages means that we’re able to source the best deals for you, regardless of where you are on your property ownership journey. We have access to the whole market, giving us admission to exclusive rates not available on the high street.

Speak to your friendly mortgage advisor

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01702 619 221

Open: Monday - Friday 8:30am - 5:30pm

How Do I Know if I Have a Bad Credit Rating?

For some, they may have no real idea they have bad credit until they are declined a mortgage by a high street lender for the first time.

However, for others it may come as less of a surprise to learn that their credit history is far from perfect. You may be receiving letters from credit card companies, are aware of missed payments or are being visited by debt collectors.

The only way to know for sure what condition your credit history is in, is to secure a copy of your credit report.

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How to Access Your Credit Report

It is now easier than ever to obtain your own credit report and see for yourself how you might fare in getting a mortgage.

Once a mortgage application is submitted, the lender will access your credit file information to assess your suitability for a loan. So, if you’re concerned about having adverse or bad credit, we would encourage you to take action sooner rather than later, and obtain a copy of your credit report. This can be done for free, from a wide range of trusted online providers.

Need help getting your credit report? Contact us today and speak with a member of our friendly team for advice.

I Have a Bad Credit Rating – How Much Can I Borrow?

When looking at how much a person can borrow, the first thing many lenders will examine is your ability to afford the loan. This means they will need to look at your income – or income(s) if it’s a joint application – as well as your regular outgoings and other credit commitments.

In addition to looking at affordability, a lot of lenders will also consider your maximum income multiple. For example, 4x or 5x your income(s), depending on the lender.

With lenders now using such diverse methods to assess the extent to which you can afford a potential loan, the best way to prepare would be to discuss your situation with one of our professional advisors.

Having experience of working with bad credit lenders, we can guide you on your next steps to getting the mortgage you need.

Quick FAQs

Have a question about getting a mortgage after late payments?

Take a look at our extensive FAQ section for the answers to some of our most commonly asked questions, below.

Generally no, this would be considered a late payment as you made the payment, but after the due date had passed. In this particular example, the late payment would be recorded with a ‘1’ next to it, to show that the payment was made within the month it was owed.

Fortunately, if you are only a few days late making a payment then it may not necessarily show on your credit report. To check whether or not this is the case, you would have to check a copy of your credit report.

This depends on whether the late payment was a one-off or one of many late payments that you have recently made. If your credit score is poor in general or you are late on your mortgage repayments, then it is highly unlikely that your application will be approved.

However, if this was a one-off late payment or it was the result of unique circumstances, for example, if you were hospitalised, then this may not impact your application in the same way. In this situation you can contact the UK’s main credit reference agencies – Experian, Equifax and Callcredit – as they may be able to enter a note of correction on your file, which will look more favourable to lenders.

Any number of late payments are taken seriously by lenders. However, the older these instances of late payments are, the less of an impact they will have with your application.

A late payment will stay on your credit record for six years.

Whilst recent late payments are taken more seriously by lenders, they do not necessarily mean that your application will be declined. They will however, provide you with fewer options. For example, you may be required to put down a larger deposit and your interest rate fees will be higher.

Contact us today! Our friendly advisors will be happy to talk you through the next steps available to you and help you on your way to obtaining the mortgage you need.

We’re here to help you, not judge you, so call us on 01702 619 221.

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