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Securing an excellent mortgage offer with Revolution Finance Brokers couldn't be easier
1Get in Touch
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2Submit Your Application
Once you've chosen your preferred mortgage deal, we'll steer you through the paperwork with comprehensive application management from start to finish.
3Mortgage Completion
Revolution Finance Brokers will finalise the details and enable you to move forward without delay!
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Are There Mortgage Options After a Debt Relief Order?

Are you reluctant to apply for a mortgage as you've repaid a Debt Relief Order and assume a lender will turn you down? Read on for the insider's guide to finding a great mortgage after paying back a DRO.

What Is a Debt Relief Order?

If you've had a debt relief order (DRO), it can be tricky to find a mortgage lender, given that credit checks are a necessary part of the mortgage application process.

In most cases, the lending policies work like this:

  • Most DROs have restrictions on what you can borrow, often limited to £500 per month for up to one year after the discharge date.
  • The DRO will need to be discharged before you apply for a mortgage.
  • Debts included in a DRO are written off after the discharge so that they won't be a continuing issue on your credit file.
  • Most high street lenders will need six years to have passed since the DRO discharge date to consider a mortgage application - although others will accept applications after one year or even sooner.

Given these restrictions, it is essential to seek expert support from an independent broker to find a competitive mortgage after discharging a debt relief order.

Here we'll run through the process, but if you would like to get started with an application, give us a call on 0330 304 3040 or email at [email protected].

About Your Mortgage
Single or joint mortgage?
What’s your yearly income?

Error: Yearly income income must be between £1 and £10,000,000.

Do you receive a regular bonus?

Error: Regular bonus must be between £1 and £10,000,000.

Based On Your Yearly Income, You May Be Able To Borrow

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Most lenders will let you borrow 4.5 times your annual salary so, as long as you have a standard 10% deposit, you should be able to borrow this much.

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Depending on your personal circumstances, some lenders may let you borrow 5 times your salary.

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Lenders usually cap the amount they lend at 5.5 times your salary, so it’s unlikely you’ll be able to borrow more than this.

What Limitations Do I Have on Getting a Mortgage after a Debt Relief Order?

It depends. If you have breached your DRO terms, you might have a further restriction called a debt relief restriction order - this might extend the discharge date of the original order.

Courts and the receiver decide on the end date, and the majority of mortgage lenders require at least a year to have passed before they will feel comfortable to lend.

If you have further bad credit problems after a DRO has been discharged, you might find it even trickier to secure a competitive mortgage. Lenders will typically need to see which accounts were included in the debt relief order.

Incurring additional credit issues after a DRO can be perceived as not having taken the order seriously, and therefore means that you are assessed as a risky applicant.

Is it Possible to Get a Mortgage After a Debt Relief Order?

It is, provided enough time has passed, and you have kept your financial affairs in good order. Lenders will want to review your credit file, so it's wise to check this and ensure that it is up to date and doesn't contain any errors.

Although some lenders will refuse any applicant with a debt relief order on their file, some have more flexible policies, including specialist bad credit lenders.

They will also assess why you ended up in a DRO situation. For example, if you have been placed under a debt relief order due to non-payment of taxes, lenders will assess your mortgage application as being of higher risk.

What Deposit Will I Need to Get a Mortgage Following a DRO?

Again, it depends on the lender's policies. They will assess when the DRO was registered and when it was discharged. The longer ago the discharge date, the lower a deposit is likely to be acceptable.

As a rough indication, the deposit you will need is as follows, based on the number of years that have passed since the discharge:

  • Less than one year - 30-35%
  • One to two years - 20-30%
  • Two to three years - 15-20%
  • Three to four years - 10-15%
  • Four to five years - 5-10%
  • Five to six years - 5-10%

Expert Advice on Debt Relief Orders and Mortgage Borrowing

If you've been in severe credit scenarios and are now seeking a mortgage, it is vital to work with a whole-of-market broker. Revolution Finance Brokers assesses each case individually to recommend the most suitable lenders, which is essential after credit problems such as a debt relief order.

For assistance with your mortgage requirements, give our bad credit team a call on 0330 304 3040, or drop us a message at [email protected].

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As specialist mortgage brokers for a huge variety of applicants, the whole-of-market consultants at Revolution provide access to an exceptional range of lenders, products and mortgage deals. That means you get the advantage of professional negotiation and broker-exclusives through an established lending network to ensure we always find you the most competitive mortgage available.

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