What can I do to repair my credit score for a mortgage?

If you find yourself looking for a mortgage and you have a poor credit score this post is aimed at trying to help you improve your chances of getting a mortgage.

The first think I think I need to mention though is that nobody has “a credit score”. The credit score itself is worthless. There are 3 credit agencies, experian , equifax and transunion, they all give you different scores based on the information available to them. So that in itself means you have at least 3 scores!

Secondly 99% of lenders do not use any of these scores. They either pull the information (balances, payment history etc) from the credit report and combine it with the information on the application to score you using their own scoring system or there are also lenders who do not credit score and base their decision on whether you fit criteria or not.

That being said, the credit score can be an indication and it will do no harm reviewing your credit reports.

Review your credit report

When reviewing your credit report, you need to be looking for a few things:

  1. Financial associates – Are you linked to someone who has bad credit? That can pull your score down. Is it possible to remove that link? It might be that it is an ex partner and you had a loan together that no longer exists. Get the association removed! Obviously if it is an ex partner and you are on a current mortgage together thats not going to work as the association is still there.
  2. Mistakes (registration dates) – Worryingly it is not uncommon for customers to spot mistakes. Defaults might be showing as registered at a later date than they should be. I know it sounds like its not important, but making those defaults older can help as it shows the adverse is more historic.
  3. Mistakes (satisfaction dates) – It is not uncommon to show defaults as being unsatisfied despite the fact it had been satisfied maybe a year or 2 prior. Again, this will also help.
  4. Mistakes in general – Are there defaults which you do not agree with? Maybe CCJs registered by ex landlords who posted the paperwork to an old address? This can make the CCJ invalid and can allow you to get it removed.

Credit report update times

Getting these changes made can take time. You might have to discuss it with the company involved first, you then need to wait for that to be reflected on your reports. It could in theory take a month or 2. I have seen updates happen within a week and sometimes take around 6 months.

That means if you are thinking of applying tomorrow, it is probably not worth trying to make these changes as it is unlikely to make much difference. If you do have time on your hands however it is worth reviewing your credit report.

It is also worth checking all 3 credit reports as they can display things differently – here is an example from a customer of ours. The same debt over the same period more or less but it looks completely different on all of them.

Debt on credit report being displayed differently on the different credit agencies.

What if you can not improve your score?

Dont worry! We have access to lenders who do not credit score. This means they base their decisions on whether or not you fit criteria. Chances are if you have 10 Defaults, 5 CCJs and have been bankrupt your credit report is going to have a very low score.

There is little point in these lenders credit scoring. They set their criteria based on what they feel they are comfortable with. The general rule of thumb here is that you need a minimum of 6 months clear. This shows the difficult period is likely behind you.

The less adverse you have or the older it is, then the rates will come down and/or the deposit needed will decrease.

But for anything like that it is worth having a phone call. We can discuss it all and give you an accurate idea of rates, fees, deposit etc. The devil is in the detail, we would prefer to give you accurate information based on your circumstances.