How to get a Council home Right to buy mortgages with CCJ’s or defaults and missed payments
In this article, we will focus on obtaining a Right to Buy mortgage with a CCJ or default that has been registered within the last three years. If the CCJ or default has been registered more than three years ago and has been satisfied, there should be a number of options available. An annual professional Mortgage Broker, such as Niche Advice, should be able to guide you to the most competitive rates out there. A higher level of expertise is required to successfully place Right to Buy mortgages with CCJS that have been registered within the last three years. Although we will concentrate on County Court judgments, we can also deal with all types of Right to Buy mortgages with bad credit.
Table: Sample of Right to Buy Lenders that we have on our panel that will accept CCJs and Defaults registered in the last 3 years.
As a general rule, Lenders 4 and 5 will offer better pricing.
| Lender | Maximum amount | Maximum number | Registered | Do they have to be Satisfied |
|---|---|---|---|---|
| 1 | No max | No max | In the last 6 months | No |
| 2 | No max | 3 in last year | 0 in last 6 month | No |
| 3 | £7,500 for CCJs | No max | 1 year ago | No |
| 4 | No max | No max | 2 years ago | No |
| 5 | No max | No max | 2 years ago | No |
Other considerations
- When choosing a mortgage with a CCJ or default, it’s sometimes a good idea to select a fixed period that takes you beyond the six-year registration date, whereby the issue should have dropped off your credit file.
- To avoid disappointment, it’s a good idea to obtain a multi-agency credit report, such as Checkmyfile, so that you understand everything is registered against you with the individual credit agencies that the Right to Buy Mortgage Lenders could use. To register to check my file, please click here. The monthly charge is £14.99, but you’re free to cancel within the first 30 days without charge.
- Who are the credit agencies that the Right to Buy Mortgage Lenders might look at?
Equifax: T: 0800 014 2955; Experian: T: 0800 013 8888; TransUnion: T: 0113 388 4300. It could be just one agency or a combination of agencies. What I’ve found is that TransUnion is rarely used on its own. - Many of the lenders that will consider CCJ’s and defaults in the last three years won’t require you to satisfy the CCJ or default, however you might wish to look at the bigger picture and certainly when you come to remortgage back to the high street Right to Buy Mortgage Lenders they will almost certainly view CCJ’s and defaults more favourably, particularly if these have been satisfied a while before the mortgage application.
- The types of CCJ and defaults are registered do matter; parking tickets on mobile phones are generally viewed more favourably; and small amounts such as is under £250 might be disregarded from the mortgage assessment.
- CCJ and defaults race did in the last three years often push you towards specialist Mortgage Lenders for Right to Buys, and they will not allow you to borrow more than the discounted purchase price. Some specialist lenders require a 10% deposit of the discounted purchase price.
- Specialist Mortgage Lenders for Right to Buys tend to have very defined policies on CCJ and defaults. If you meet these rules and are within these, you should have a clear path to acceptance. In contrast, with traditional banks and building societies, it usually comes down to computer credit scoring, reason for the CCJ and default, whether it’s been satisfied and open to the intervention of an Underwriter.
- Specialist mortgage lenders for Right to Buys tend to operate in the intermediary broker market only and are not accessible directly by members of the public.
- It is also worth noting that while Right to Buy Mortgage Lenders generally accept houses, they can be more selective with flats, particularly when there is low private occupancy, high-rise buildings, and balcony/deck access to the front door. Sometimes, the Right to Buy mortgage lenders also have a minimum property value, so it’s worth making sure you’re aware of this ahead of any mortgage applications.
- If you have had credit problems in the past, such as CCJ and defaults, it is advisable to choose A Right to Buy mortgage lender that offers a soft footprint on your credit file at the decision-in-principle stage, so that this search will not impact your public record.
If you’re looking for a Right to Buy Mortgage and have experienced CCJS and defaults, I suggest getting in touch with Niche Advice, and we will guide you to the most suitable option for you. If you have any other types of Right to Buy mortgages with bad credit, please get in touch.
