Can I Get a Mortgage After Repossession?

Recovering your finances after repossession is one hurdle, but will you ever be eligible for a mortgage again if you’ve had a previous property repossessed?

About your mortgage

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

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

Based on your yearly income, you may be able to borrow:

£0

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.

£0

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

£0

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.

This calculator is an estimation of how much you could borrow. If you’re ready to take out a mortgage, speak to a Revolution brokers to see what options are available.

Can I Get a Mortgage After Repossession?

If you have repossession in your credit file, you may have found that many high street lenders will automatically reject you for a mortgage application.

However, there are options available, and an independent, whole-of-market broker such as Revolution can advise on:

  • Which specialist lenders are most likely to be able to help.
  • How to structure your application and deposit to increase your approval chances.

Let's explore the criteria and how lenders decide whether to offer a mortgage after repossession. If you'd like tailored advice or to start your mortgage application process, give us a ring on 0330 304 3040, or email mortgage advisors at info@revolutionbrokers.co.uk.

What are the Mortgage Criteria After Repossession?

Each lender has different policies and lending rules, but all will look at the following criteria to decide whether they can offer to lend:

  • When the repossession occurred.

If that were within three years, you would usually need a significant deposit to offset the increased risk. You can find mortgages with a 15% deposit between three and six years, and if it were over six years ago, you would typically need a deposit of around 5%.

The below table indicates how likely you are to find a mortgage after a set period and what sort of deposit requirement to expect:

Time passed since repossession

Likely deposit requirement

Difficulty factor in finding a new mortgage

Within a year

Extremely unlikely

Zero

One to two years

30 - 35%

Challenging

Two to three years

30 - 35%

Challenging

Three to four years

15%

Possible

Four to five years

10%

Possible

Five to six years

10%

Possible

Over six years

5%

Most likely

  • Whether you have other credit issues to consider. If your repossession is one of several credit issues, you will find it far more challenging to secure a mortgage.
  • How much money was involved? If you have experienced repossession for a significant value or over multiple properties, the application will be a significantly higher risk than for one repossession of a modest value.
  • Why your home was repossessed. Should there be a life event that impacted your ability to keep up with your mortgage, it is vital to explain this in the application process. A lender may be more sympathetic if they can see that the situation is unlikely to recur.
  • What the Loan to value is on the new application.
  • Your affordability - most lenders will offer up to three times your income if the repossession was within three years. You can often borrow up to four times your income from three years and up to five times your annual earnings after six years, provided you meet all the other criteria.

How Can I Recover After Property Repossession?

Once your property is repossessed, it is sold, and the proceeds used to repay the outstanding mortgage and any other secured debts. One difficulty can be that if the sale doesn’t recover enough cash to pay back the debt, you will still need to repay the mortgage - these are known as legacy repayments.

You will also need to cover the cost of legal fees and estate agent fees deducted from the sale proceeds.

Repossessions stay on your credit report for seven years of the first missed payment - so the longer ago it occurred, the better your chances of mortgage approval.

Dome applicants also find that if they still have debts to repay, they end up with court judgements or other issues, which can have a long-term impact on your credit report. It is essential to avoid falling into further debt by using payday loans, as these will inevitably make it harder to get a mortgage again in the future.

The best thing to do is to repay any remaining debts as quickly as you can.

Why Does it Matter Which Bank Repossessed my Property?

Interestingly, the lender who repossessed your property may influence your ability to get a mortgage in the years to come.

Many high street banks are part of larger groups, and therefore any financial institution within that group will almost certainly refuse your application.

It is, therefore, crucial to work with an independent broker who can signpost your application to niche lenders who have no association with the repossessing bank.

Can I Remortgage With Repossession on My Credit File?

Potentially yes. However, as with any other mortgage, you will have a limited number of lenders who are likely to consider the application.

Why Do I Need a Broker to Get a Mortgage After Repossession?

It is crucial to use an experienced broker to:

  • Have the best chances of mortgage approval.
  • Indicate which lenders will consider a repossession applicant.
  • Negotiate terms and rates on your behalf.
  • Advice on borrowing products relevant to your circumstances.
  • Compare rates available throughout the market.

Applying directly to a lender without a broker's negotiating skill to back up your application is far more likely to fail. This can rack up multiple mortgage checks and damage your credit file further.

If you are interested in getting a fresh mortgage after repossession or have been turned down by another bank, get in touch with Revolution for independent advice. The team is available on 0330 304 3040 or via email at info@revolutionbrokers.co.uk.

Why Revolution Brokers?
  • Whole of market brokers

  • Mortgage that suits you

  • On time customer support

Further Reading

Latest Blogs

11 Mar 2022
Guide to Remortgaging to Finance a Home Renovation

Remortgaging your home is a great way to release equity and raise finance for those home improvement jobs you've always wanted to do. Before applying, it's vital to work out how much equity you have in your property and ensure sufficient capacity to borrow the funds required for the renovation you have in mind. In today's article, t..

10 Feb 2022
Do I Qualify for First-Time Buyer Status?

Do I Qualify for First-Time Buyer Status? Working out whether or not you are a first time buyer may seem obvious - but there are plenty of scenarios where your position isn't clear! Examples might include: New buyers who have inherited a property they rent out. Buy-to-let investors that have never purchased a residential hom..

26 Jan 2022
How Does a Remortgage Application Work?

Most homeowners know that remortgaging means switching a mortgage from an existing lender over to a new deal. However, the process isn't always obvious. If you're on a fixed-rate deal, you'll want to get ahead of the end of the term to avoid being shuffled onto a higher standard variable rate where your interest costs will undoubtedly ..

17 Dec 2021
Understanding Lender Risk on First-Time Buyer Mortgages

Finding a great mortgage as a first time buyer can feel like an uphill struggle, with a larger proportion of applicants being turned down than a year ago. Around 20% of first-time mortgage applicants are rejected, usually because of the lender risk associated with their loan. Today, Revolution Brokers explains the highest risk facto..

28 Oct 2021
Pros and Cons of First Time Buyer Buy to Let Mortgages

Investing in a rental property can be an excellent way to get onto the property ladder and earn an income. However, if you haven't owned a residence before, you might find that a mainstream bank will automatically turn you down for a buy to let mortgage. In today's guide, the Revolution Brokers team explains how you can become a ren..

12 Oct 2021
Mortgage Deposit Requirements for First-Time Buyers

Buying a home for the first time is a massive step - but the deposit is often a stumbling block for first-time buyers. It can take years to save a sufficient amount or be impossible, so there are several ways to approach the problem and get your foot onto the property ladder. From April 2021, the UK government launched the new mortg..

Offer!

Refer, Relax and get £50

If you refer a friend for a mortgage or any
type of finance you’ll both receive £25
each when their new application
successfully completes.

Know More!

We are proud
members of the:

FCA disclaimer

The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature. We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.

Ask the Mortgage Experts

Revolution Brokers understands that mortgages can be complex and confusing!

Ask us any question you might have, and one of our skilled consultants will come back to you as quickly as possible.