Can You Remortgage with Bad Credit?
Yes, you can remortgage with bad credit, though your options may be more limited and rates typically higher than mainstream products. Specialist lenders exist specifically to help borrowers with adverse credit histories, including those with CCJs, defaults, missed payments, IVAs, or previous bankruptcy.
Your existing lender might offer you a product transfer (switching deals without a full application), which often has less stringent criteria than a new lender application. This could be an option if you can't get approved elsewhere, though rates may not be the most competitive.
How Credit Issues Affect Remortgaging
The impact of bad credit depends on severity and recency. Recent issues or larger amounts are viewed more seriously than older, smaller problems. A satisfied CCJ from 5 years ago is treated very differently to an active default registered last month.
Lenders consider: when issues occurred, whether they're satisfied or ongoing, amounts involved, how many issues exist, and how credit behaviour has improved since. Demonstrating recovery and responsible credit use helps your application.
Specialist Bad Credit Lenders
Lenders like Kensington, Pepper Money, Precise Mortgages, and Bluestone specialise in adverse credit remortgages. They manually underwrite applications rather than relying on automated decisions, allowing them to consider your full circumstances and any explanations for past problems.
Rates from specialist lenders are higher than mainstream products, reflecting additional risk. However, securing a specialist mortgage can be a stepping stone - as your credit improves, you can remortgage again to better rates later.
Improving Your Chances
More equity helps offset credit concerns - if you've got significant equity in your property, you're a lower risk to lenders. Stable income, manageable debts, and recent positive credit behaviour also strengthen applications.
Check your credit reports before applying and correct any errors. Register on the electoral roll if you haven't. Avoid new credit applications in the months before your remortgage application, as multiple searches can negatively impact your score.
Working with a Specialist Broker
A broker experienced in bad credit cases knows which lenders accept specific types of adverse credit and can match your application appropriately. This avoids unnecessary declines that would further impact your credit file.
Complete our form for a free consultation. We'll assess your situation and explain your realistic options without impacting your credit score.