If you have a CCJ, you may wonder if you can get a mortgage or if it totally derails your chances of approval. Fortunately, the answer is that you may be eligible, but it depends on your circumstances.
A County Court Judgment wouldn’t be the sole reason you couldn’t get approved if you receive a denial as lenders look at the big picture – not just one aspect of your financial life. Most mortgage lenders look at various aspects of the CCJ, which we discuss below.
How Old is the CCJ?
How long ago was the CCJ filed against you? Lenders pay close attention to this. An older County Court Judgement, especially those that are two years or older, will have less of an effect on your ability to get a mortgage than one filed within the last few months.
A more recent filing means that you are currently in default and possibly in financial trouble. Lenders will look more closely at your financial life and determine where you stand. An older filing may be easier for a lender to ignore.
How Many CCJs do you Have?
Lenders also look at the quantity of CCJs that you possess. If you have more than one, that signifies that you are not financially responsible and are likely to default on your mortgage. If the CCJs you have been on the ‘older’ side, though, you may find a lender willing to work with you.
Did You Satisfy the CCJ?
Big factor lenders consider is whether or not you satisfied the CCJ. If you made good on your debt and you have a valid reason for the occurrence in the first place, you may find a willing lender. If you satisfied the debt recently, you may need to verify where you obtained the assets to do so when applying for a mortgage.
How Much is the CCJ?
If you have a large CCJ, lenders may be less willing to give you a mortgage. If they do, expect it to be for a much lesser amount. Lenders view borrowers with large debts as high risk. In order to compensate for that risk, they may ask for a larger deposit, giving you only a 65% – 75% loan rather than one with a much higher loan-to-value ratio.
Making Up for a CCJ
If there’s one thing that speaks to lenders when you have a CCJ and need a mortgage, it’s a large down payment. Whether you have multiple County Court Judgements against you, recent CCJs, or you still have unsatisfied CCJs, a large down payment can make the difference between a loan approval and loan denial.
It’s important to talk with a qualified mortgage advisor when determining if you qualify for a home loan with a CCJ. Don’t count yourself out of the running yet as there are many options available to those even with ‘poor credit.’ Learn your options and see what may be available to you even with lingering debt on your back.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE