Can I Get a Right to Buy Mortgage in Bristol With Bad Credit?

Residents in Bristol who have been renting from a local council or housing association may discover eligibility for purchasing their rented home through the government Right to Buy Scheme. Typically, a discounted purchase price, often acceptable as a deposit, is provided.

To qualify for Right to Buy in Bristol, one must have been a public sector tenant for a minimum of three years, with the duration of tenancy influencing the discount received.

Individual circumstances vary, and while the process may be straightforward for some, it can present challenges for others. Bad credit, for instance, may significantly impact mortgage eligibility.

Fortunately, for those questioning the possibility of obtaining a Right to Buy mortgage in Bristol with bad credit, the answer is affirmative.

Although personal circumstances and the discretion of mortgage lenders play a role, engaging a mortgage broker in Bristol can offer potential options for securing a Right to Buy mortgage.

How do I know if I have bad credit? 

The definition of bad credit varies among mortgage lenders. Some may consider missed credit card payments, phone contract payments, or loan instalments as indicators, while others may overlook such instances.

However, experiences like withdrawal, bankruptcy, or a CCJ attached to your name categorise you as having bad credit. In such cases, a decreased credit score can impact Right to Buy Mortgage eligibility in Bristol.

A lower credit score poses challenges in obtaining a mortgage, even with a panel of lenders specialising in bad credit mortgages.

What types of bad credit will have an impact on my Right to Buy mortgage?

Bad credit can have adverse effects on any mortgage, not just Right to Buy. Factors such as bankruptcy, Debt Management Plans (DMPs), Individual Voluntary Arrangements (IVAs), and repossessions can complicate mortgage approval.

Specialised mortgage lenders may consider applicants who have been discharged from bankruptcy for 3-6 years or completed DMPs and IVAs for at least 3 years. Repossessions, however, may make securing a Right to Buy mortgage difficult.

How does having bad credit affect a Right to Buy mortgage?

The likelihood of approval for a Right to Buy mortgage with bad credit often depends on the time elapsed since the credit issues. Attempting to improve financial situations, such as clearing CCJs and maintaining a tidy credit file, can enhance chances.

While this doesn’t guarantee approval, it provides potential options. Consulting a dedicated mortgage broker in Bristol, like Bristolmoneyman, with access to specialist lenders, is advised for tailored solutions.

If I have bad credit, do I need to put down a deposit for my Right to Buy mortgage?

For applicants using a Right to Buy mortgage to purchase a local authority home, the discount applied can often serve as an acceptable deposit.

However, for those with bad credit, the higher risk may lead mortgage lenders to request additional deposits, especially if the discount is equivalent to a smaller percentage. The flexibility may vary based on individual circumstances, tenure duration, and the mortgage lender.

A higher deposit, whether for Right to Buy in Bristol with bad credit or without, can open doors to better mortgage deals, reducing monthly payments or interest rates.

Date Last Edited: January 23, 2024