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Applying for a First-Time Buyer Mortgage With Bad Credit

First-time buyer mortgage if your credit score is less than perfect, but that you’ll have a much better chance of success working with an independent, experienced broker who can identify the right mortgages first-time buyers need that are compatible with credit issues.

Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

Almas Uddin2023-05-09
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Applying for a First-Time Buyer Mortgage With Bad Credit

Finding a mortgage for bad credit first-time buyer applicants can be difficult, as many lenders will consider a first-time buyer higher risk. Adding adverse credit to the scenario will often mean high-street banks and other mainstream lenders are less likely to offer to lend to a first-time home buyer.

However, that does not mean you can’t get a first-time buyer mortgage if your credit score is less than perfect, but that you’ll have a much better chance of success working with an independent, experienced broker who can identify the right mortgages first-time buyers need that are compatible with credit issues.

Today we’ll run through tips and advice to help you determine the right mortgage for bad credit first-time buyer applicants and find ways to strengthen your first-time buyer mortgage application.

Applying for a First-Time Home Buyer Mortgage With Bad Credit

The first pointer is that you should be upfront about any credit issues that may impact your ability to apply for some mortgages first-time buyers products.

Downloading your credit report from all the major bureaus is a good starting point, as you’ll be able to review how a lender might perceive you as a first-time buyer.

Next, we'd recommend contacting the Revolution team to discuss your circumstances since there are several specialist lenders who will consider a first-time home buyer UK mortgage, even with bad credit, and where you have been turned down by other lenders.

Every lender has varying policies and rules about the credit issues they will accept, so as a first-time buyer, it's essential you don't make numerous applications to lenders who will automatically refuse.

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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.


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


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.

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Mortgages for Bad Credit First-Time Buyer Applicants With Bankruptcy History

Bankruptcy is one of the more serious credit issues a first-time home buyer may need to try and address, but you may be able to proceed. In this case, you will almost certainly need a lender with mortgages first-time buyers specifically designed for adverse credit applicants.

A lot depends on when the bankruptcy was filed, the context, and whether your finances are now in good order – any lender will want to see a first-time buyer has a stable income, a good deposit, and the ability to keep pace with repayments.

Many of the best specialist first-time buyer lenders who will consider bankruptcy applicants do not advertise or deal directly with the public, so a broker is essential to access these more niche deals.

Getting a First-Time Buyer Mortgage With a CCJ

County Court Judgements or CCJs are another potentially serious credit problem for a first-time home buyer UK, and it remains advisable to consult an experienced first-time buyer broker to evaluate your best options.

In most situations, you’ll be able to apply for mortgages first-time buyers provided your CCJ has been repaid in full or satisfied. A first-time buyer with an outstanding CCJ will normally need to select their choice of lender very carefully, as some providers will not lend in these circumstances.

A first-time buyer lender will need to know when the CCJ was registered, whether you have had several CCJs in the past, if you have since repaid the debt, and whether you have any other credit problems that might affect your eligibility for a first-time home buyer mortgage.

Lenders will normally expect a higher deposit from a first-time buyer with adverse credit to offset their perceived risk.

Mortgages First-Time Buyers With Defaults on Their Credit Score

As a first-time home buyer with defaults on your credit report, it may be trickier to find the right first-time buyer mortgage than an applicant with a good credit score. Still, as long as you can comply with the lending criteria, there are suitable first-time home buyer mortgages.

Some lenders will disregard certain defaults, such as a default related to a mobile contract, but will have a different stance on a first-time buyer with a default against a secured loan.

Finding a First-Time Buyer Mortgage With an IVA

IVAs can signify a lack of money management skills, so some lenders will not lend to any first-time home buyer with an outstanding IVA. However, the point of this repayment agreement is to help you get your finances back under control, in which case you may be able to apply for a first-time buyer mortgage.

A first-time buyer with an IVA may wish to wait until the report has expired from their file after six years but can proceed with a mortgage working with an experienced broker who can recommend the right specialist lenders or products that are open to first-time home buyer applicants with bad credit.

Applying for a Mortgage for Bad Credit First-Time Buyer Applicants With Payday Loans

Payday loans may not necessarily indicate bad credit, but many lenders are reluctant to offer a first-time home buyer UK a mortgage if they have a history of payday loans, since they are associated with very short-term financing, which may be linked with poor money management.

Like every credit issue, your chances of securing a first-time buyer mortgage depend on your choice of lender since, while banks will commonly refuse to lend to anybody with a payday loan history, other providers are more flexible.

Niche first-time buyer lenders make decisions on a case-by-case basis, so they might look at how many payday loans you have used, to what value, and the last time you used short-term borrowing.

A first-time buyer might have one payday loan from five years ago, resulting in immediate rejection by a high-street bank that another lender won’t consider particularly problematic.

How to Apply for a Bad Credit First-Time Home Buyer Mortgage

Whenever we work with a first-time home buyer UK, we look at the circumstances as a whole, from the deposit available to the person’s income, debts, outgoings, credit history and the value of the property they wish to buy.

It may also make a difference if you are using one of the first-time buyer schemes. Although the Help to Buy first-time buyers scheme has now closed, there are several alternatives which we’ll look at shortly.

Lenders work through the same process, so it helps to understand what your application will look like as a first-time buyer with any form of adverse credit history.

Accessing your credit reports, correcting errors or updating your details is useful because it lessens the likelihood of a lender having queries or questions about elements of your first-time buyer mortgage application.

The next step is to work with a first-time buyer broker to pinpoint your requirements and match your borrowing needs to a suitable lender, considering their policies, attitude towards the type of bad credit you have, and the amount you need to borrow.

Deposit Requirements for a Bad Credit Applicant for Mortgages First-Time Buyers

A first-time home buyer UK will typically need at least a 5% deposit, and sometimes 10%, but you should be aware that if you have bad credit, a lender may ask for a higher down payment, sometimes up to as much as 20%.

Much depends on the lender you apply to, and if you don’t have a substantial deposit available, it is certainly worth speaking with a first-time home buyer broker to identify the appropriate lenders who won’t command a down payment above your means.

As we've mentioned, you might also be able to access one of the alternatives to the Help to Buy first-time buyers scheme as a way to purchase a property regardless of your credit score.

Shared Ownership for First-Time Buyer Mortgages

Shared Ownership is a good option for a first-time buyer with bad credit and a small deposit because you can purchase a proportion of the property rather than needing to save up a sizable down payment to offset the risk of having adverse credit.

You pay rent on the balance you do not own to the relevant housing association but can still qualify for first-time buyer mortgages on whatever share you are purchasing.

Guarantor Mortgages for a First-Time Home Buyer With Bad Credit

Another solution could be to apply for a first-time buyer guarantor mortgage, where a family member provides assurance that they will cover the repayments if you fall behind. You are still a first-time home buyer UK, but the lender has extra security if they feel your application is otherwise too high a risk.

Using Right to Buy as a Bad Credit First-Time Buyer

Finally, if you are a tenant in a council property, you may be eligible to use the Right to Buy first-time buyer scheme, where you purchase the property at a good discount, meaning a small deposit might make up a larger percentage down payment.

Professional Advice on Finding a Mortgage for Bad Credit First-Time Buyer Applicants

We recognise that the challenge of getting a first-time buyer mortgage is exacerbated if you have been turned down due to bad credit – and the good news is that we can normally recommend a lender who will consider your application.

If you'd like more information about any of the options included here or to discuss your first-time buyer mortgage requirements and credit position, please contact Revolution Finance Brokers at any time.

Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

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Frequently Asked

Usually, yes, there is a product and lender for almost every first-time buyer. The first step is to get in touch so we can understand the scenario and the adverse credit issues you have, and then work through solutions and advice to help you make informed decisions about the right way forward.

When we talk about specialist or niche lenders, we simply mean lenders who work with a range of applicants who fall outside of the lending criteria and policies imposed by most banks and high-street lenders.

Niche first-time buyer mortgage products are legitimate, secure and authentic, but these lenders tend only to deal with brokers within their established networks – they don't often advertise or include their specialist products on price comparison sites.

Yes, it's possible to apply to varied lenders who are less concerned with your credit score and more with your financial position, stability and deposit. If you can provide evidence that you have the means to keep up with your repayments, and a suitable down payment, you are likely to be approved.

Although all lenders are regulated, their policies and internal rules are entirely at their discretion. For example, one lender might never lend to anybody with a credit score under a nominal figure or with any history of payday loans.

Another lender might have a different policy that states they won't consider a first-time buyer with a CCJ or bankruptcy – but these organisational lending terms vary considerably. An independent broker with whole-of-market access to first-time buyer mortgage products can suggest lenders whose rules will make it more likely you will be able to access the borrowing you need.

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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.

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