Challenges of getting another mortgage after your home has been repossessed.

Whilst applying for another mortgage after repossession is a hard ask, it is not impossible to achieve!

If you understand the challenges that you will be facing and make the right approaches, you can put yourself back on the path to meeting the lending criteria of some lenders.

Let’s face it, Home repossession significantly impacts your credit score. Lenders see a repossession as a serious default and can remain on your credit report for up to six years, affecting your ability to get new credit, including a mortgage. The number of lenders willing to consider your application will be limited and be prepared to face higher interest rates and possibly a higher deposit.

The first step towards getting another mortgage is to focus on rebuilding your credit score. This includes ensuring all your current debts are paid on time, using credit rebuilding tools like credit builder cards, and keeping your credit utilisation low. Given the likelihood of needing a larger deposit, start saving as early as possible. A larger deposit not only increases your chances of mortgage approval but can also help secure a more favourable interest rate.

When applying for a new mortgage, transparency about your financial history and repossession is crucial as Lenders will find out about your past, so being upfront and honest about it, and demonstrating what you’ve done to improve your financial situation since, will work in your favour.

Looking for a mortgage broker experienced in dealing with applicants who have faced repossession is not a bad idea as they can offer invaluable guidance, help you understand your options and find lenders more likely to consider your application. You must also be prepared for a different experience than your first mortgage application as the process will be more complex, require more documentation, and take longer.

It is well worth remembering that patience and perseverance will help you overcome the hurdles created by repossession and are key as each step you take towards rebuilding your financial health, brings you closer to achieving your goal of home ownership once again and not impossible to achieve.