How Does My Credit Score Impact My Chances of Getting a Mortgage?

Sian at Planet Mortgages

23 September 2021
By Sian

Thinking about purchasing a property? Confused about credit scores and mortgage requirements? Have no fear, we're here to help. We've compiled some useful information about credit scores and how they can impact mortgage applications.

Happy couple searching online for mortgage deals and information about credit scores
Purchasing a property is an extremely exciting milestone and a massive achievement. From the first time you turn your key in the lock to meticulously planning interior choices, there’s so much to look forward to. Before you get to this stage, it’s important that you put yourself in the best position possible to be accepted for a mortgage. With so much to consider and put in place, we understand that the mortgage process might seem complex, daunting and at times even a little disheartening. But, that’s where we step in! 

Here at Planet Mortgages, we can guide you through the entire process. It’s helpful to have an understanding of the mortgage process and to be aware of the aspects that lenders take into consideration when reviewing your mortgage application. One of the factors that could affect your mortgage application is your credit score. Below, we’ve answered some of the common questions on credit scoring and how it relates to your mortgage eligibility.  

What is a credit score?

A credit score is a tool that allows lenders to determine whether you qualify for a mortgage, loan, credit card or service. It is a three-digit number that is calculated by the information on your credit report. The higher your credit score, the lower your risk that you’ll miss payments. So, people with a higher credit score are typically more likely to be accepted for a mortgage. However, your credit score is not the only factor that lenders will take into consideration. 

What else can impact my chances of getting approved for a mortgage?

When you apply for a mortgage, you’ll be required to submit payslips, P60s and bank statements which will help the provider build a picture of your financial situation and your monthly budget. Your credit score and report will help mortgage lenders see how you’ve managed debts in the past and will provide them with an idea of how you might behave in the future. 

What can negatively affect my credit score?

There are a number of things that can impact your credit score and various ways that you can improve your score. You may find that some of these factors can affect your credit score…

  • Your repayment history
  • How much available credit you’re using 
  • Credit history length
  • The number of hard searches on your credit report
  • Public records 

An experienced mortgage broker can advise you on ways to improve your credit score. Their expert knowledge of the industry will also allow them to only approach lenders that are likely to accept your mortgage application.

What if I don’t have a credit score?

If you’re a first-time home buyer without a credit score, you’ll be pleased to know that it is still possible to be accepted for a mortgage. Our team will be able to advise you on the best route to take if you haven’t built up a credit score. 

Here at Planet Mortgages, we pride ourselves on going above and beyond to ensure that our clients get the best mortgage deal possible. With so much to consider and put in place, we understand that purchasing a property can feel a little daunting. But, we’ll be there to support you at every step of the way. So, you can rest assured that you won’t have to face the homebuying journey alone. 

Get in touch with our friendly, experienced team and let us help you land your dream home.