Last reviewed on 10th August 2023 by Martin Alexander (Mortgage Advisor)
Having a County Court Judgment can get in the way of your mortgage. Multiple CCJs will make mortgage approval even more difficult, but there is light at the end of the tunnel. Although it isn’t easy, the chances of getting a mortgage with a CCJ are a lot better than most people think.
Over the past few years, there’s certainly been an increase in lenders offering mortgages to those with credit issues. That being said, each lender has different criteria, so it’s important to apply with a lender that’s suited to your circumstances.
It’s also worth noting that it isn’t just a CCJ that can result in a lender declining your mortgage. There are a number of factors that can affect your mortgage. This guide will explore each of the points above in further detail. You can also make an enquiry with a specialist at any time.
- What is a County Court Judgment (CCJ)?
- Can I get a mortgage with a CCJ?
- When was your CCJ registered?
- Has your CCJ been satisfied?
- How large are your CCJs?
- Number of CCJs on your credit report
- How much deposit will I need if I have a CCJ?
- What type of mortgage can I apply for with a CCJ?
- How much can I borrow if I have a CCJ?
- Can I get a mortgage if I’ve had further credit problems?
What is a County Court Judgment (CCJ)?
You’ll receive a County Court Judgment if you fail to repay certain debts. That being said, this is usually the last resort your creditors will take and will follow calls, letters and notices chasing the debt.
Having a CCJ on your credit file isn’t to be taken lightly. Although it can make mortgage approval difficult, it can even stop you from opening a bank account and getting a credit card. CCJs will be recorded on your credit file, which will always be checked each time you apply for any type of loan, including a mortgage.
How long will a CCJ stay on my credit file?
CCJs will typically stay on your credit file for six years. Even if you settle your CCJs much sooner, they’ll still appear on your credit file. If you feel the CCJs are incorrect, you can speak to the credit referencing agency to get them removed much sooner. Nonetheless, if a court has issued you with a judgment, there’ll be no other way to remove them.
Can I get a mortgage with a CCJ?
Getting a mortgage with a CCJ is possible, but you’ll need a cautious approach. It’s very unlikely you’ll be able to go to a high street bank and be approved for a mortgage. This means that with the right advice and preparation, a CCJ shouldn’t stop you from getting a mortgage.
If you have a CCJ, lenders will assess the following:
- Date of when the CCJ was registered
- Whether or not your CCJ is satisfied
- The amount of your CCJ
- The number of CCJs on your credit report
- Amount of your mortgage deposit
- The type of mortgage you need (residential or buy to let)
- Other potential issues on your credit report
Even regular mortgages can seem like an uphill struggle. Once a CCJ is involved, things can get really difficult and it’s often where most people give up. Don’t give up! With an expert on your side, your chances of getting a mortgage are significantly increased. As specialist CCJ brokers, we know exactly how to prepare mortgage applications and match suitable lenders.
When was your CCJ registered?
The dates your CCJs were registered are usually the most crucial factor when applying for a mortgage. As a result, lenders pay particular attention to the dates surrounding your CCJs. Your mortgage chances improve with older CCJs, whereas more recent CCJs will have the opposite effect.
A CCJ that was registered two years ago isn’t as relevant as a CCJ that was registered just a few months ago. That being said, it’s still possible to get a mortgage even with a very recent CCJ. If your CCJs are over six years old, they’re unlikely to affect your mortgage chances. It’s recommended to download a copy of your credit file to be sure your credit file is correct.
Has your CCJ been satisfied?
As with any mortgage, each lender has its own specific criteria. Some lenders will require you to satisfy your CCJ before applying for a mortgage, whereas other lenders won’t. If you have satisfied your CCJ, then you’ll have more lenders to choose from. The date you satisfied your CCJ is important to lenders such as these.
If you’ve yet to satisfy your CCJ, then be sure to approach lenders where CCJ settlement isn’t a factor. If you’re unsure, you can speak to an advisor. We’ll know exactly which lenders are more likely to lend depending on your circumstances.
What if I have an unsatisfied CCJ?
If your CCJ was registered over 2 years ago, then it’s still possible to get a mortgage without satisfying your CCJ. If you have a more recent CCJ that remains unsatisfied, mortgage approval will be difficult.
Mortgage with a satisfied CCJ
Some CCJ mortgage lenders will require your CCJ to be satisfied at least one year ago. Other lenders will allow you to satisfy your CCJ right before you apply.
How large are your CCJs?
After assessing the date of your CCJ, lenders will calculate its total value. Your CCJ amount still plays a very important role in your mortgage assessment. If your CCJ was registered around three years ago, then the amount wouldn’t really hold any relevance. If your CCJ was more recent (within the last 12 months) then there may be limits to how much you can borrow.
As time goes on, the amount of your CCJ becomes more and more irrelevant. Some lenders will only lend if your CCJ was below £3000 for instance (in the past 3 years). In comparison, the same lenders will only consider a very recent CCJ if the amount was less than £1000.
The value of your CCJ can also impact the amount of deposit you’ll need. If you have a very large CCJ then you may need a deposit of 30%. Applications with smaller deposits may be approved if your CCJ is less than £1000.
Number of CCJs on your credit report
The number of CCJs you have registered against your name will also affect your mortgage chances. If you have more than two CCJs, then you may need a minimum deposit of around 25%. Some lenders also require the CCJs to be over a year old. If you have multiple CCJs which were registered in the last 12 months, you’ll require a substantial deposit to be considered for a mortgage.
Some lenders also have a ‘CCJ cap’. This means lenders simply won’t lend if you have a certain number of CCJs. For instance, one lender may restrict CCJs to a maximum of two. So if anyone has more than two CCJs they’ll simply decline the application. The good news is, that not all lenders are the same and may still consider your application, no matter how bad you may think your situation is.
It’s highly advised to check your credit file before applying for a mortgage. You can then see the exact details of the CCJs, such as the dates, amounts and the number of CCJs you have against you. Lenders will check your credit files, so it’s a good idea to check them beforehand.
How much deposit will I need if I have a CCJ?
In all cases, the higher your deposit is, the more favourable lenders will be. This is because there’s less risk involved if you’re putting down a larger-than-average deposit. If you have a smaller deposit in addition to a CCJ, then you’ll be seen as high risk by lenders.
If you have a 5% deposit, then your CCJ will likely need to be over three years old. A 25% deposit can allow you to get a mortgage even if your CCJ was registered within the last year. Anything higher than 25% will give you a lot more flexibility in the mortgage market.
What type of mortgage can I apply for with a CCJ?
The type of mortgage you’ll need will also have a bearing on your mortgage assessment. If you already own your property and are looking to move or remortgage, then applying for a mortgage with a CCJ is perhaps the easiest of scenarios.
If you’re purchasing a new build or you’re a first-time buyer, then lenders start to become less flexible. Some lenders may not accept borrowers with CCJs over £1000 and other lenders will require CCJs to be satisfied 12 months ago. The good news is that there are still lenders that may consider you in these circumstances.
Buy to let mortgages are next in line and are perhaps the most difficult to obtain when you have a CCJ. Lenders may require you to satisfy your CCJs before applying and will generally require a large deposit. Other lenders may only lend if your CCJ is over two years old. Don’t let this dishearten you. There are specialist lenders available when things get really tough.
How much can I borrow if I have a CCJ?
If you have a CCJ, the amount you can borrow is based largely on the details of your CCJ in addition to your income and deposit amount. Once lenders have assessed the details of your CCJs and whether or not they’ve been satisfied, only then will a lender be able to confirm their maximum LTV (loan to value).
Lenders may restrict the mortgage amount to four times your annual income if you have a CCJ. If your CCJs are older than two years, then you may be able to borrow up to five times your annual income. These are approximate guides, as this does depend on your individual circumstances and the lender you’ve applied with.
Applying for a mortgage with a CCJ can get very complex depending on your situation. This is because there are many different factors that lenders use to assess an application. Once our advisors understand your complete financial situation, we can then provide you with a more informed answer as to how much you can borrow. Furthermore, we’ll also guide you on the products you’ll be eligible for. A planned and structured approach is crucial in getting a mortgage with bad credit.
Can I get a mortgage if I’ve had further credit problems?
In addition to a CCJ, further credit issues will make it increasingly difficult to get a mortgage. The extent of your other credit issues will play a part in how lenders assess you. Late payments are seen as less severe by lenders as opposed to something more severe such as repossession.
Lenders may still consider you for a mortgage with a CCJ, even if you have other credit issues such as bankruptcy, or you’re applying after an IVA, so don’t be disheartened in your attempts to get a mortgage. Our advisors specialise in mortgages with poor credit and work with specialist lenders on a daily basis. Remember, you can speak to an advisor if you’re still unsure of what to do next.
About the author
Martin is a senior mortgage advisor and has held a CeMAP qualification for over 15 years while also completing an MBA in Global Banking & Finance.