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Remortgage with bad credit

Last updated on 20th November 2023 by Martin Alexander

Remortgaging with bad credit can be difficult, as most lenders require a good credit score when switching mortgages. Lenders will check if you’re eligible to remortgage, but having bad credit can raise concerns.

The good news is that remortgaging can allow you to switch to a better rate. A better deal can boost your finances and help your credit file.

As you already have a mortgage, lenders will check whether you’ve repaid your mortgage on time. Doing so can help your application, and you may even be able to remortgage with severe credit problems.

Key takeaways from this article:

  • You can remortgage with bad credit
  • Remortgaging can allow you to get a better deal
  • Rebuilding your credit file before remortgaging can make it easier
  • Speak to an advisor to find an eligible lender that accepts your credit issues

Can I remortgage with bad credit?

You can remortgage with bad credit, even with severe credit issues. You’ll need to find a suitable lender, but you may be charged higher rates than usual.

Not all lenders will accept poor credit, and the lenders that do will consider some credit issues and not others. The best thing you can do is to speak with an advisor who can check which lenders you’re eligible for.

Getting approval for a remortgage is often easier than getting a new mortgage on a different property, especially with bad credit. You’re likely to have equity in your home and a record of mortgage payments, which will support your application.

Will equity help me to remortgage?

Having equity in your home can boost your borrowing power, but it does depend on the lender you’ve applied with. A lender that’s not suitable can decline your mortgage, no matter how much equity you have.

On the other hand, if you’ve accumulated debt, you can remortgage to release equity to pay off your debt. Clearing outstanding debts can also boost your credit score and make it easier to remortgage.

Read more: How to remortgage to pay off debt

Which credit issues can I remortgage with?

A poor credit rating can affect your remortgage in different ways. For instance, severe credit issues like bankruptcy will affect your remortgage more than lighter credit issues such as late payments.

Each credit file tells a different story and is just one of many factors lenders will assess.

Late payments and mortgage arrears

Lenders view missed or late payments as minor credit issues, especially related to phone or other household bills. But paying your mortgage late is considered severe, so remortgaging with mortgage arrears can be challenging.

Most lenders will hesitate to offer you a remortgage because you need to catch up on your current mortgage. Mortgage arrears also indicate that you’re struggling financially.

Some lenders may consider you if you’ve had mortgage arrears but have since caught up with your payments. You’ll still be required to explain why you fell into arrears. Having ample equity can also help you in this situation.


Although it’s possible to remortgage with defaults, you’ll need to tread carefully. Some lenders specialise in mortgages with defaults, but you’ll still need to meet the rest of their criteria.

In addition to the rest of your application, lenders will require details around your defaults, such as:

  • The type and number of defaults you have
  • How recent your defaults are
  • Whether you’ve satisfied your defaults

You can get a remortgage, even if you’ve not yet satisfied your defaults. Lenders will be more concerned with your recent defaults, as any in the past 12 months can make it harder to remortgage.

County Court Judgments (CCJs)

Some lenders will allow you to remortgage with a CCJ. Lenders will assess the details of your CCJs and whether you have other credit problems.

Lenders will require details of your CCJs, such as:

  • The dates and amounts of your CCJs
  • The number of CCJs you have
  • Whether you’ve satisfied your CCJs

CCJs in the past 12 months will make it harder to remortgage. In comparison, CCJs over two years old should have little impact on your application, especially if you’ve satisfied them.

CCJs for smaller amounts will also have less effect on your mortgage. However, some lenders don’t accept CCJs at all.

Remortgaging with an IVA

You can remortgage with an IVA, but it can be better to complete your IVA before applying. Waiting until after you’ve been discharged will give you a much better choice of lenders.

Some lenders will allow you to remortgage your home to pay off part or all of your IVA. Lenders will check whether you’ve made your IVA payments on time, which you’ll need to provide evidence of.

An IVA is a severe credit issue usually involving other credit problems, such as CCJs and defaults. Remortgaging will be much easier if you were discharged over three years ago.

Learn more: Can I get a mortgage with an IVA?

Debt management plan (DMP)

Remortgaging with a DMP is possible. Your affordability check will be more relevant as you pay a fixed amount for your DMP each month. You’ll need to show lenders you can pay your DMP and the new mortgage you’ve applied for.

Completing your DMP will make it easier to remortgage. The longer you’ve been discharged, the better, as you’ll have more lenders to approach.


Bankruptcy is one of the most severe forms of adverse credit. It’s not possible to remortgage during bankruptcy. You can apply for a remortgage once discharged.

Remortgaging will be difficult if you’ve been discharged for under three years. You’ll have many more lenders to apply with once three years have passed from your bankruptcy discharge date.

It’s important to note that some lenders won’t accept applicants who have had a bankruptcy, past or present. So, you’ll need to check which lenders accept bankruptcies as part of their criteria.

If you are offered a remortgage after bankruptcy, you’ll have to pay higher rates and fees.

How can I improve my credit score before remortgaging?

Improving your credit score is easier than most people think. You can take the following steps to improve your credit score before remortgaging:

  • Check the electoral roll to ensure your address details are up to date. Having an old address registered can knock your credit score.
  • Using your credit card rather than a debit card can help build your credit score. You’d repay your entire credit card balance monthly using a direct debit to ensure no missed payments.
  • Repaying your bills on time can improve your credit score. You’d need to be careful to make your payments on time, as late payments will damage your credit score.
  • Minimise your debt by staying below 50% of your available credit limit. While you should be using credit to improve your score, using too much can hurt your credit score.
  • Check your credit file to ensure it’s correct. Any errors can bring your credit score down, especially if there are issues you’re unaware of. You can download your reports online, which won’t affect your credit score.

Read more: How to improve your credit score

Can I remortgage without a credit check?

It’s possible to remortgage without a credit check, but there are a few caveats. It would help if you remortgage with your existing lender. Still, there are no guarantees that you can remortgage without a credit check.

Each lender has a unique policy and may still carry out credit checks with existing borrowers. If you remortgage with an entirely new lender, you will undergo a credit check.

What is considered a bad credit score to remortgage?

Each credit referencing agency uses different credit scores. As a result, there isn’t one universal credit score that guarantees your remortgage will be successful. For instance, Experian would suggest you have a poor credit rating if you score below 560. A poor credit score with Equifax would be below 379 and TransUnion below 550.

With this in mind, don’t let your credit score dictate your mortgage chances. Some lenders accept those with poor credit, but there’s still much to assess regarding a remortgage application.

Remortgage with bad credit FAQs

Remortgaging with a low credit score can be simple for one applicant but complicated for another. For instance, your credit score could be low due to having credit problems, or you may have little or no credit history.

You can improve your application in other areas if you have a low credit score. For instance, having equity or a suitable income shows lenders you can repay a mortgage.

If you have a low score due to credit problems, you’ll need to find a lender that considers your credit issues.

A credit check is just one part of your remortgage assessment. It’s possible to have a brilliant credit score and still not be approved for a mortgage simply because of failing other checks.

In addition to your credit history, mortgage lenders will also consider the following:

  • Loan to value or LTV – This is the amount you’re borrowing against how much your property is worth. The more equity you have, the lower the LTV. Having less equity or a smaller deposit will result in a higher LTV. A low LTV typically unlocks better rates and deals.
  • Affordability – Lenders will calculate how much you can borrow by assessing your income and outgoings. The more you earn, the more it will help your application. In comparison, spending a lot each month can have a negative effect.
  • The dates of your credit issues – Older credit issues typically have less impact than recent ones. Credit issues over six years ago will have little effect on your remortgage.
  • The overall health of your finances – If you’re still going through financial difficulties, lenders will proceed cautiously. Getting your finances back on track since your credit issues will certainly boost your mortgage chances.

If a lender has declined you, you may need a specialist mortgage advisor. We won’t just say no if we can’t find you a mortgage due to your credit rating. We’ll help you repair your credit score until you can remortgage.

Sometimes, it’s just a matter of adjusting your LTV to minimise your risk in the eyes of a lender. Getting approved for a 75% mortgage is much easier than a 90% one. Mortgage rates for bad credit aren’t always the most competitive, so be prepared for slightly higher rates than expected.

Many applicants with poor credit go straight to their bank or another high street lender only to be declined or offered a mortgage at an extortionate rate. This is probably the worst thing you can do.

High street lenders generally tend to deal with clean credit applicants and, as a result, aren’t the best places to go if you have credit problems.

You’ll typically require a specialist advisor to remortgage with bad credit. If you decide to take your chances but get declined, this can further damage your credit report, along with a waste of time and money.

Your reasons for remortgaging can affect whether you’re approved or not. Remortgaging has different benefits, depending on the deal you’ve chosen.

Reasons for remortgaging include:

  • To improve your existing mortgage rate
  • Debt consolidation
  • Raise capital for a purchase or expense (for instance, to buy a car or holiday)
  • Remortgage to release equity (for investment or home improvements)
  • Relationship breakdown (remortgage to buy out an ex-partner)
  • Let to buy (let your existing home to buy a new home for yourself)

If you wish to remortgage for any of these reasons, our experts can help.

Lenders typically use the big three credit agencies to check your credit report. These are TransUnion, Equifax and Experian. You can also use credit rating websites that check multiple reports for you.

Downloading your report won’t leave a footprint or affect your credit score.

You can work out whether it’s worth remortgaging by comparing your current deal to the cost of a new deal.

If you’re approaching the end of your fixed term, your mortgage rate will switch to your lender’s standard variable rate (SVR), which can be expensive. Although remortgaging can allow you to change to a better rate, having bad credit may lead to higher rates than usual. So, you’ll need to compare the cost of your current deal to a new deal to determine whether remortgaging is worth it.

About the author

Martin Alexander
Senior Mortgage Advisor

Martin is a senior mortgage advisor who has held a CeMAP qualification for over 15 years while completing an MBA in Global Banking and Finance.