Bad Credit Buy To Let Mortgage

Everything you need to know about getting a Bad Credit Buy to Let Mortgage

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Is There A Bad Credit Buy To Let Mortgage?

There are many lenders that specialise in getting a Bad Credit Buy To Let Mortgage. Whilst their products are not exclusively for this purpose they are most likely to have a mortgage to suit your situation. You will likely find that if you have had Bad credit in the past you may need a specialist lender. However depending on what it was for, how long ago it was and how much it was for, you may have options on the high street.

Can I Get A Buy To Let Mortgage With Poor Credit?

Yes you can. It will all depend on how long ago it was, how much it was and what it was for. It will also depend on the type of mortgage you are going for, is it in a limited company name or in your personal name? Is it an HMO or are your tenants on a single Assured Shorthold Tenancy agreement? We’ve detailed some of the different types of bad credit below.

What Types of Bad Credit can affect my mortgage?

When you are considering a mortgage and feel you may have bad credit history your first stop should always be to check your credit history. For this we recommend you use Checkmyfile. We recommend Checkmyfile as they will show you your credit report with the three major credit referencing agencies.

Once you have a credit report you will have a better idea of what your problems may be.

Defaults

A Default usually occurs when you do not pay a monthly commitment for a number of months. This leads the lender to close your account and mark it as defaulted. They may then chase you for the money owed. If you have a default we recommend that you pay it, this shows to lenders that whilst you had a problem, you have rectified it. If your default was over 6 months ago you may have options, but the longer ago it was the better. Some lenders may also ignore a default if it is a small one, or is for utilities rather than a credit commitment.

Ccjs

A CCJ, or County Court Judgement is when someone has gone to court and the court has decided you owe them money and have to pay. If this happens you usually have a month to pay the debt off, and if you do it won’t hit your credit report, or if it does it will be removed. Like a default the longer ago the better, and if its smaller it may be ignored.

Bankruptcy

Bankruptcy can make things difficult when trying to get a mortgage. You have to declare any bankruptcy you have ever had in most mortgage applications. There are however some lenders that will consider an application after as little as two years of it being discharged.

Iva

An IVA or Individual voluntary agreement can possibly be considered by lenders after 2 years, but you will most likely have to wait until after three unfortunately.

Mortgage Arrears

You will probably struggle if you have had mortgage arrears in the last 12 months. However if it was longer ago than that you should have options.

Missed Payments

Missed payments on unsecured debt can be a bit of an issue for some lenders. However there are lenders that will consider missed payments, even in the past 12 months.

Payday Loans

Much like missed payments PayDay loans are a bit of a red flag to lenders. That said some will still consider you with them.

What Are The Criteria For A Bad Credit Buy To Let Mortgage?

Criteria varies from one lender to another, so it’s best to speak to a qualified advisor. Which leads to another point, not all Buy to let mortgages are regulated, and therefore you may not get a qualified advisor in some places. At Albion Forest Mortgages all of our advisors are qualified.

Who Is The Best Mortgage Lender For Bad Credit Buy To Let Mortgage?

This is a tough one to answer. There are lots of lenders that may be ok with some bad credit but not others. The likes of Bluestone, Aldermore, Kent Reliance all have products for bad credit. However depending on the severity of your issues you may be able to go with a high street lender.

How Much Do You Have To Earn To Get A Buy To Let Mortgage?

This varies from lender to lender. Some will want a minimum income of say £20,000 or £25,000. However some lenders have no minimum income requirements. Speak to a Qualified Advisor and they should be able to recommend the right lender for you.

Will Having Bad Credit Prevent You From Getting A Buy To Let Mortgage?

It depends on when it was, what it was for and how much it was. Lots of lenders ignore small bad credit, or if it was for things like mobile phones or parking fines.

Low Credit Score

Most lenders don’t look at your ‘Credit Score’ and score you internally instead. Your score is just a number that is representative of your credit history. That is why it varies from one credit referencing agency to another.

Buy To Let Mortgage Bad Credit Rating

Similar to the above question, Credit rating or score isn’t always used by a lender. Instead they assign their own scoring system. It’s important to remember that your credit score is just a number to give you an idea of how well your credit history is.

Bad Credit Buy To Let Mortgage Calculator

We don’t have one unfortunately. This is due to the fact that different lenders assess things differently. They may even assess differently depending on the product that is used. However if you can spare us ten minutes over the phone we can tell you for free.

How Much Stamp Duty For A Bad Credit Buy To Let Mortgage?

Usually a Buy to let mortgage is a second home, and therefore you have to pay more stamp duty on the purchase of one. Before applying for a mortgage it’s important to speak to a tax advisor or use the government website to work out how much stamp duty you will have to pay.

Do I Need A Mortgage Advisor For A Bad Credit Buy To Let Mortgage?

You don’t NEED a mortgage advisor for any mortgage technically. However it’s probably advisable. If you are getting a bad credit buy to let mortgage you will probably need one. Not just to find the right mortgage lender for you, but to package your case correctly.

Will I Need A Specialist Lender For A Bad Credit Buy To Let Mortgage?

Maybe, depending on how bad your credit problem is. If it was small or a long time ago you may have options on the high street for a mortgage. This is why it’s best to speak to a qualified Mortgage Advisor.

How Much Deposit Do I Need For A Bad Credit Buy To Let Mortgage?

You will usually need between 20-25% deposit for a buy to let mortgage. You may need more for a Bad Credit Buy to Let Mortgage. It will all depend on what your bad credit was, how long ago it was and how much it was.

Got A Question We Haven’t Answered? Try Our Main Buy To Let Mortgage Broker Page. Still No Luck? Get In Touch.

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