Mortgages After Bankruptcy

Bankruptcy is generally considered as a serious credit issue when it comes to applying for a new mortgage. High street lenders will normally back off, and their strict criteria will prevent them from funding you.   

The biggest factor lenders will consider when deciding to give you a mortgage is how long it’s been since your bankruptcy was officially discharged. You won’t be able to apply for a mortgage until this has happened. It’s usually after 12 months, the more recent the discharge the trickier it can be to obtain your mortgage.  

The deposit requirements for most lenders will depend on discharge dates.

These are typical deposit amounts:

from the day after discharge from bankruptcy a 30% deposit is required.

This will be the case for the first year following discharge, when after two years our lenders will consider you with a 20% deposit.

After three years we can consider a mortgage application with a 10% deposit, on high street lending terms. 

There are also a couple of high street lenders that will consider you if the bankruptcy notice has just been removed from your credit file (6 years after the initial bankruptcy registration)

Your mortgage interest rates are likely to be slightly higher after a bankruptcy in the early years compared to someone without a bankruptcy.

Initially if we get a mortgage from a specialist lender for you and then you go on and meet your repayments on time and in full, your credit rating should start to recover. With a stronger credit rating, you might, at some point, be able to remortgage and move to a conventional mortgage lender offering more competitive interest rates.

If you’ve had further or subsequent credit problems since your bankruptcy;  a CCJ, any defaults or arrears; this may cause added complications.

however we thoroughly consider all circumstances.