County Court Judgements (CCJs) are not the biggest cause for concern for mortgage companies. Missed payments, defaults and bankruptcy are arguably lenders’ biggest red flags. That said, many of the bigger High Street banks may turn you down automatically if you don’t have a flawless credit profile, simply because they will lack confidence in your ability to make your repayments on time.
If you’re worried that previous or active CCJs will reduce your chances of being able to get a mortgage on a new investment property, read on for more information on what to expect from the process – and reassurance that you may have more options than you think.
What to consider when applying for a Buy-to-Let mortgage
A Buy to Let (BTL) mortgage is designed for people who are looking to purchase additional property and rent it out in order to make a profit on their initial investment. In the UK, there are no limits on how many properties one person can own – so, as long as you understand your responsibilities and duties as a landlord, it can be an incredibly lucrative way to generate capital.
When looking for a Buy-to-Let mortgage, price is a very important factor, as it will directly affect the viability of your investment. When working out how much you can afford, you will need to consider how much you will need to set aside for the payments on your residential mortgage (if you have one), as well as any other financial commitments that could affect your ability to keep on top of your BTL mortgage repayments. Remember, too, that Buy-to-Let deposits are significantly larger than those for a standard residential mortgage. You will usually need a bigger down payment to not only secure a mortgage in the first place but access the most competitive rates.
Buy-to-Let mortgages have been notoriously difficult to obtain in the past due to stringent income and affordability checks, not to mention volatile markets. For the best chance of success, it’s important to explore all your available options before making a decision on which lender to use.
How will having CCJs affect your BTL mortgage application?
A County Court Judgement (CCJ) is issued when you fail to pay back the money that you owe. As you can imagine, this black mark against your credit file can have a hugely negative impact on your chances of successfully applying for a Buy-to-Let mortgage.
Many high street lenders will refuse to lend to people who have an open CCJ, or one that has occurred within the previous 3 years.
Whilst it can be more difficult to get a BTL mortgage with a recent CCJ on your credit file, there are still mortgage lenders that will accept you. Although CCJs are often a sign of other credit problems – and are rarely given in isolation – if you’re able to show evidence of a steady income and a clear credit history since the CCJ was issued, lenders are likely to look upon your application more favourably.
If you have a CCJ on your file, it’s important to work with a broker who has experience in working with mortgage providers who are open to supporting individuals in similar circumstances. They will be able to point you in the direction of appropriate lenders, and ensure you do not negatively impact your credit rating even further by applying for mortgages that you are likely to be declined for.
Why use a mortgage broker?
That’s the key to getting a mortgage with CCJs: getting your application right the first time. We’ll help you find a product that meets your needs, from a lender who is more likely to take a view on your case.
We can get quotes from virtually all UK providers – large and small – because we have access to the whole of the mortgage market and are not restricted by any preferential agreements. Once we’ve found a Buy-to-Let mortgage deal that ticks all your boxes, we’ll work tirelessly to collect all the relevant documentation before liaising with the provider and getting a decision from them as quickly as possible.
Expert mortgage advice for every eventuality
It's true, we've organised buy-to-let mortgages for all kinds of borrowers, and as specialist mortgage brokers, we're not stuck with one lender, we've got the whole market to search through to find the best mortgage providers for every unique case.
We don't just cover buy-to-let applicants or borrowers with CCJs. Your mortgage advisor is there to provide every type of solution, finding different ways to finance your property purchase with mortgages and mortgage products for every type of buyer. If you need any information or someone to track down the offers you can't find, we're ready to hear from you.
We find the best deals on mortgages for every type of borrower and home owner
Have partnerships with all kinds of mortgage lenders
Provide mortgage advice for those with bad credit or a low credit score
Deliver all kinds of bad credit mortgages
Solve problems with mortgage arrears
Deliver mortgages in line with a total rental income
Cover mortgage options for typical and unusual borrow requests
Offer tailored advice for specific situations
Arrange mortgages for every property type
Offer advice for self-employed, company directors, and professionals
Seek mortgage approval for those with other debts and adverse credit problems
Access specialist finance for those with only an approximate annual income
We find mortgages to get anyone on the property ladder
Put simply, we take the stress, time and hassle out of finding and securing a BTL mortgage that suits your situation. For more information, or to book a free initial consultation with one of our experienced brokers, get in touch with CLS Money today.