Jasmine Birtles
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Does a CCJ mean the end of your mortgage hopes?
Isobel Lawrance
23rd Dec 2022
2021 saw a rise of 33% in the number of CCJs issued against individuals. If you are one of the nearly 900,000 consumers against whom one of these CCJs were issued, then you may be wondering ‘can you get a mortgage with a CCJ’.
If you believe that you won’t be able to get a mortgage with a CCJ, you may be wrong. We spoke to Simply Adverse, a leading adverse mortgage broker who specialises in mortgages with CCJs.
- Getting a CCJ
- Does it matter that I have a CCJ?
- How much impact will your CCJ have?
- You can get a mortgage with a CCJ
Getting a CCJ
CCJs (County Court Judgments) are issued against you in the event of your failure to repay money you owe. The process leading up to a CCJ being issued is quite lengthy, so it’s not something that should come as a surprise to you. They are only issued if you have either failed to respond to attempts by your creditor to create a payment agreement, or you have been unable to reach an agreement about what any repayment schedule should look like.
The best course of action if you do get behind with any credit payments is to keep up a dialogue with creditors and try to find a way forward. In general, when you owe money the company you owe money to would much rather come to some sort of agreement than go to court.
However, if a CCJ is made against you it will be added to the Register of Judgments, Orders and Fines unless you either repay the full amount owed or can prove that the CCJ was issued in error. Any CCJ recorded on the register will also be added to your credit report.
Does it matter that I have a CCJ?
Having a CCJ recorded on your credit report could affect your ability to get credit in the future, including your ability to find a mortgage. This is because lenders may be concerned that your past failure to meet your debt commitments indicates that you are a poor risk for future credit.
There are caveats though. How much impact your CCJ has on your chances of finding a mortgage will depend on several factors, and you may find that securing a mortgage isn’t out of reach.
How much impact will your CCJ have?
How much your CCJ can affect your mortgages chances could be based on the following:
When your CCJ was made – more recent CCJs will generally have a bigger impact than CCJs from longer ago.
Number of CCJs – while having one CCJ may only present a small problem, multiple CCJs can pose a real risk that you won’t be able to find a lender.
Amount of your CCJ – as may be expected, smaller CCJs are viewed more favourably by lenders than CCJs in respect of larger amounts.
Is the CCJ satisfied? – If the CCJ is satisfied, that is paid in full, it will be much easier to get a mortgage than if it is unsatisfied.
You can get a mortgage with a CCJ
Lenders don’t just take into account your CCJ when assessing your application. They’ll also look at things like other types of adverse credit you have or how much your income is. As they consider more than just your CCJ there are other elements that will have an effect.
The size of your deposit. A larger deposit means a smaller mortgage loan, which means a greater chance of success.
The type of mortgage you want. Buy-to-let mortgages for example tend to have stricter criteria than other mortgages.
How much you can afford in repayments. If you have a large income and few outgoings, finding a mortgage may be more straightforward.
Mortgage brokers who specialise in adverse credit give you the best options. A whole of market bad credit mortgage broker will be much more likely to help you get a mortgage with a CCJ. This is because they have access to all lenders and deals, many of which are only available to brokers, they are also experienced in placing customer who have CCJs with the right lenders. Their up to date market knowledge gives you the best chance of getting a mortgage.
As you can see, there is no simple answer to whether you will be able to get a mortgage when you have a CCJ, as there are multiple factors that may affect your chances, but it’s certainly not true to say it’s impossible.
Understanding your position and taking professional mortgage advice can help you to find your perfect mortgage. Good Luck.
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