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Buy to Let Mortgages with Bad Credit

Written By:
Myles Robinson - Expert Finance Advisor

Posted: Aug 12, 2022

Can I get a Buy To Let Mortgage with bad or poor credit?

You might be interested in investing in a buy-to-let property or a buy-to-let mortgage but are concerned about your poor credit history.

Many UK mortgage lenders now offer buy-to-let mortgages for those with poor credit.

Enquire today to speak with our mortgage brokers for free mortgage advice. We can then introduce you to a mortgage lender who works with poor credit history:

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What mortgage lenders are available for those with poor credit?

Many lenders will approve customers with poor credit. These include high-street mortgage providers, challenger banks, and specialist companies.

The type of adverse credit, its cause and how long it has been on your record will all play a role in whether your application is approved. Finding a lender specialising in your type is perhaps the most important thing.

First, confirm the nature of your credit problems. Also, verify when and for how much.

Our guide will show you how to understand the different criteria banks and lenders use when they offer Buy To Let mortgages to customers with poor credit histories.

If you have poor credit, your bank may not be the right place to look for a Buy To Let mortgage.

High street lenders tend to use an automated credit score. They don’t specialize in lending to people with poor credit histories. You could be denied a Buy To Let mortgage.

A bad credit advisor is an excellent resource if you’re considering buying a Buy To Let mortgage. They can help you find lenders that match your criteria and even connect you with banks, building societies, and other providers you wouldn’t be able to reach directly.

This article will discuss common credit issues, debt management plans, how they can impact your Buy To Let mortgage application, and the available options.

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Let’s first look at the various types of credit issues in order of severity.

Credit score low

Credit score and credit history are two different things.

Credit history is your financial history. It is usually only available for the past six years. BTL prime lenders will use credit scores to score your application. This score is based on many factors, including your credit history and income.

Even if you have good credit, you can have low credit scores. This could be due to frequent moving or not having any credit history.

While not all banks or building societies will give you a credit score for your credit history, all lenders will.

Low credit scores may make it more challenging to get the best rates. However, there are still options for Buy To Let mortgages for those with poor credit scores. You can borrow up to 85% LTV and more.

Noting that you may have too many credit applications on your record could damage your credit score. Lenders will be more concerned about your Buy To Let application. Our guide provides more information about credit checks to obtain a mortgage.

A reputable, all-encompassing advisor who is familiar with the market and can arrange mortgages for people in your position without submitting multiple unsuccessful applications, further damaging your credit score, is the best way to find adverse Buy-To-Let lenders.

We recommend that you sign up to Experian, Check My File and Equifax, which will give you a complete picture of what banks and other mortgage providers see in your file.

Signing up for all four is wise, as the files may differ regarding what is registered. Experian’s credit file may be transparent, but Equifax could have something that causes you to get declined.

No matter which reports you choose, they are divided into the same sections. These are the main sections:

  • Financial account information assesses credit activity, including credit cards, mobile phones and utilities. It also includes mortgages, loans, and mortgages.
  • Public records include County Court Judgements (CCJs), bankruptcy, etc.
  • Credit search history lists all credit searches that you have made by different creditors or insurers.

Your score won’t be affected by searching and downloading your file. Only applications for credit or searches by lenders will do this. You can search your file unlimited times with no impact.

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Late payments

Late payments are not unusual on credit files. Most people have missed at least one payment in their lifetime.

Some lenders may not be sympathetic to this and will decline creditworthy applicants because they have missed their payments. However, many lenders can look beyond late payments and offer competitive rates and LTVs for landlords who have paid late.

Lenders will examine your credit file for late payments and the period since they occurred.

You would be able to access more banks and rates if there were only a few late payments in the past year than if there were multiple.

There are still lenders who will lend to customers with bad credit and late payments.

You must remember the difference between arrears and late payments.

Late payments are missed payments on a single account. Most creditors give borrowers until the end of the calendar month to register the missed payment as a formal miss payment on their credit file. So if you make your monthly payment on the 1st and pay it on the 25th, creditors won’t consider it late payments and will not report it to credit agencies.

Likely, the type of account for which you have not paid a payment will make the most difference in whether or not you are approved for a mortgage.

It is less common to miss payments on unsecured accounts than on secured credit.

All types of unsecured credit include current account overdrafts and phone bills. Examples include credit cards, personal loans, and credit cards. Mortgages count as secured credit, as do secured loans.

Mortgage arrears

Arrears refer to missed payments that have not been paid for at least one month. A person is considered “in arrears” if they owe more than the current month’s payment.

Buy-to-let mortgage arrears are treated the same as missed payments on secured loans, mainly if they have been in arrears for over a month. This indicates that the borrower cannot repay the loan and, therefore, their creditworthiness to apply for a new loan.

It is not unusual for landlords to fall behind on payments on one mortgage on multiple properties. This could be because the property has been unlet for a while.

Customers looking for Buy To Let mortgages with arrears have many options.

Like late payments, lenders will also consider adverse credit Buy To Let Mortgage lenders more severe than historical arrears. Therefore, the rate and LTV you can get on a poor credit Buy To Let mortgage will depend on how many arrears are on your credit record and when they occurred.

If you can explain why payments were missed and how the problems have been resolved, some lenders may be more accommodating to mortgage arrears.


A default on a borrower’s credit file is one of the most common reasons for Buy to Let mortgages for those with poor credit histories. They stay on your credit record for six years. A default notice is a formal notification sent to borrowers when they have missed several credit payments. Usually, borrowers default when there are between 3 and 6 missed payments.

Good news: More BTL bad credit mortgages are now available for default borrowers. This means finding a Buy To Let mortgage with default is possible.

Lenders will consider your credit history and whether you have defaults. This is known as satisfaction.

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County Court Judgements (CCJs).

Increasing numbers of lenders will offer a Buy To Let mortgage to a borrower with CCJs.

The main factors that lenders will consider include the value of your CCJs and how many have been registered to you. How recent they were registered?

Finally, whether or not the debt has been satisfied.

A CCJ does not necessarily mean that a Buy To Let mortgage application will be denied. The date of the CCJ matters the most. You would have more options if the CCJ were filed more than 12 months ago. Some lenders will consider customers with CCJs registered less than a year ago. It is worth talking to a professional mortgage advisor about your options.

Debt Management Plans (DMPs)

If you are in a current performing debt management program or have been in one, it is possible to obtain a Buy To Let Mortgage. We work with specialists skilled in arranging Buy To Let Mortgages for those with poor credit histories.

Many people who are still in DMPs also have credit problems. Both can be linked because people who need a DMP for financial reasons are more likely to have other credit problems.

Each customer is unique and will be evaluated based on different factors. Borrowers with active DMPs can have late payments (maximum three months), defaults (top 2 registered in 2 years), any number older than this, some CCJs (2 registered in 2 years), and still be eligible for a bad credit Buy to Let mortgage.

If you have IVA, bankruptcy or repossession from the last six years, the likelihood of being accepted is low.


A Buy to Let mortgage can be more difficult if you have an Individual voluntary arrangement (IVA). However, it is possible. Your options will depend on whether or not you are in an IVA.

An IVA may limit your options for buying a mortgage with poor credit. Lenders will usually require proof that you have been making repayments on time.

Each lender will use different criteria to determine the impact of an IVA. However, generally speaking, the more recent an IVA was established and the more credit you have, the greater the equity required to offset perceived risk.

You’re more likely to have IVAs than you think. This is due to other credit issues that could have led to IVA arrangements, such as defaults or debt management plans. Therefore, you can expect to pay a higher interest rate and deposit when applying for Buy To Let mortgages for poor credit. It all depends on the severity of your case and how recent it was.


Although Buy to Let mortgages are available for bankrupts discharged, lenders may decline any person with bankruptcy.

There are a few Buy-To-Let lenders that will consider mortgages for those who are bankrupt. If you’re interested in applying for a Buy To Let mortgage for bad credit, we can help you locate the right advisor.


A few specialists Buy To Let lenders will accept mortgage applications after repossessions. Rates can be surprisingly competitive due to increasing competition among lenders.

You have the option to get a new Buy To Let Mortgage if you have had a Buy To Let foreclosure in the past. This will also depend on how recent the repossession occurred and your other credit history. If you have tenancy arrears or other financial problems, a Buy To Let home repossession could be an isolated event on your credit file. A lender may want to know if you are a risk to future borrowing.

Like another subprime Buy To Let mortgage, your options will depend on the rental income you can achieve from the investment property, and the deposit required.

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I have bad credit and need help getting a Buy to Let mortgage.

If you have ever had credit problems and are unsure what to do next, contact the bad credit brokers who will review your case and provide expert advice.

They may even be able to connect you with BTL lenders that specialise in low credit.

What other factors could affect my ability to get a Buy To Let mortgage in the UK with poor credit?

This section will discuss the other factors influencing bad credit mortgage lending decisions. These include affordability and deposit size.

What does affordability mean for a BTL mortgage with bad credit?

When applying for a Buy To Let mortgage, it’s not only your credit score that will be considered. It is also essential to assess affordability.

What are the affordability requirements for a buy-to-let mortgage with poor credit?

You will need to prove that you can afford the payments.

The affordability of Buy to Rent is based on the potential rental income that the property could generate and your personal circumstances.

Many lenders require that the rental income cover the mortgage amount if the buyer is a basic rate taxpayer or a limited company. This assumes the mortgage is charged at 5.5%. This increases to 145% and 160% for higher rate taxpayers.

Hypothetical example

Purchase to Let Mortgage Balance = £300,000.

Calculated interest at 5.5%

Monthly interest payments = £1,374

A mortgage lender will examine your entire portfolio if you are a portfolio landlord who buys to let. This is to ensure that you aren’t overstretching yourself when borrowing.

Lenders may also examine your assets, liabilities, and income.

The maximum loan amount will be reduced if the rental income is insufficient. However, some lenders allow you to supplement your rental income with personal income.

This is also known as top-slicing, where the landlord uses their earned income to make up for any shortfalls in Buy to Let affordability.

Another factor to consider when evaluating affordability is that rates and fees on Buy To Let mortgages with bad credit histories will be higher than those for people with clean credit records. This can have an impact on rental calculations.

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What amount of deposit do I need to get a BTL for bad credit?

You can only make a deposit as much as you can afford. If you have poor credit, you may not be able to get a high-LTV Buy To Let mortgage.

However, many lenders will not consider Buy to Let mortgages with an 85% LTV or higher.

How will my age impact my application for a BTL?

Lenders consider it responsible and sustainable to lend to Buy To Let investors past their retirement age, as affordability for a Buy To Let mortgage is determined by rental income. While some lenders set a maximum period for the term at 100, others do not.

Speak to a BTL expert for poor credit today

You can contact our specialist mortgage brokers to discuss any topic in this article.

Relax, and let us find a qualified mortgage broker to handle your situation. There is no fee, and you are not under any obligation to improve your credit rating.

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