How Your Credit Score Affects Mortgage Approval
When applying for a mortgage, your credit score plays a vital role in determining how lenders view your financial reliability. It can influence not only whether you're approved but also the types of deals you're offered.
What Is a Credit Score?
A credit score is a numerical representation of your credit history, based on your borrowing behaviour, repayment history, and credit utilisation. In the UK, the three main credit reference agencies – Experian, Equifax, and TransUnion – all have slightly different scoring systems.
How Lenders Use Your Credit Score
Lenders use your credit score to assess risk. A high score suggests you're a reliable borrower, while a low score might signal a history of missed payments or high debt.
Your credit score affects:
Whether you’re approved
The size of your loan
The interest rate offered
How much deposit you need
How to Improve Your Score Before Applying
Register on the electoral roll
Check for and correct any errors on your credit report
Keep credit card balances low
Avoid applying for multiple credit products in a short time
Always make repayments on time
Don't Panic if Your Score Isn’t Perfect
Some lenders specialise in helping those with poor or limited credit histories. A mortgage broker such as ourselves can help you explore suitable options based on your unique profile.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE