Getting a mortgage after repossession
You might be forgiven for thinking your aspirations for home ownership came to an end when your property was unfortunately repossessed.
But, we know that your credit history isn’t your whole story.
See how much you could borrow for a mortgage after repossession, only takes a few minutes, NO CREDIT CHECKS!
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Updated: August 12th, 2025
Can I get a mortgage after repossession?
If your property was repossessed, you may believe that you can never get a mortgage again. However, this is not necessarily true. There are options available, and it is possible to obtain a mortgage after repossession.
People who have experienced this can still get a new mortgage after repossession. However, the number of lenders available to them will be limited. We know of specialist lenders who cater for borrowers in all kinds of adverse credit situations. These will consider applications from people who have previously had homes repossessed.
What factors affect a lender’s decision if I have been repossessed?
When the credit crunch hit, it affected a lot of people in different ways. Many homeowners lost their properties due to factors beyond their control. However, they are now in a solid financial position again. As a result, they are able to put down a deposit and may be looking for a mortgage after repossession.
Conditions vary from lender to lender. Many are willing to consider offering a mortgage after repossession to those who may have had financial difficulties in the past.
In general, when making decisions on a mortgage after repossession, lenders will look at three main criteria:
- The details around why the previous repossession occurred.
- How you have handled your financial affairs since it happened.
- The state of your current finances.
In the next sections, we’ll go over these one by one.
The details of the repossession
The lender will ask the following questions about your previous repossession:
When did the repossession occur?
Your answer to this question will impact how likely a lender is to offer you a mortgage after repossession in the first place. It will have some bearing on the level of deposit you will need to put down on your new mortgage. As ever with adverse credit events, the more time that has passed since the event happened, the better, especially for a mortgage after repossession.
If you’re wondering how long after a repossession can you get a mortgage this table gives a general idea:
| Time Since Repossession | Minimum level of Deposit | Likelihood of Approval |
|---|---|---|
| Under 12 months | N/A | Not possible to get a mortgage, |
| 1 – 3 years | 30% – 50% | Difficult, but possible depending on individual circumstances. |
| 3 – 6 years | 10% – 20% | Good, with options improving. |
| 6 years plus | 5% – 10% | Very likely, with broader lender choice and more competitive terms. |
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This information is significant for your application for a mortgage after repossession. It will influence how willing a lender is to grant you a mortgage. If your financial situation suffered due to reasons beyond your control then a lender is likely to be more sympathetic. Perhaps if you were a victim of fraud or suddenly lost your job.
You will need to show proof of any mitigating circumstances. Our team knows how to best present this information so that it helps your application for a mortgage after repossession.
How much money was involved?
The level of financial commitment will be less important than the amount of time that has passed. But it will still have some influence on the lender’s decision for a mortgage after repossession. If the event was around a single mortgage and involves a lesser amount, relatively speaking, then a lender will look upon your application more favourably.
‘Perceived risk’ is the important phrase here. A lender will view your financial history as a kind of guide. The fewer the mortgages involved and the lower the value, the better.
Who was the lender?
The answer will have a direct impact on whether the lender you’re talking to will offer you a home loan, particularly a mortgage after repossession. Many mortgage providers, although trading under different names, are part of the same banking group.
For example: AA, Bank of Scotland, Birmingham Midshires, Halifax, Intelligent Finance and Saga are all parts of the Halifax/Bank Of Scotland group (HBOS). If you apply to different lenders within the group, you are actually applying to the same company.
If you had a property repossessed by one member of the group, then it’s likely that any other member will turn you down for a mortgage after repossession.
Is any money still outstanding?
If you still owe money to the lender who repossessed your property, then this is very likely to impact your chances of getting a new mortgage after repossession.
If you are still paying off a previous loan, then you have less money available to service another mortgage. As part of their affordability assessment, a lender will take this commitment into consideration when you apply for a mortgage after repossession.
Are there any other credit issues on your credit file?
Understandably, when people are experiencing difficult financial circumstances, they will prioritise keeping a roof over their heads. As a result, they may perhaps defer or default on other less-vital payments.
As someone who has had a previous property repossessed, it’s relatively likely that you will also have some other bad events on your credit reports. These might include anything from missed card payments, a County Court Judgement (CCJ), Individual Voluntary Arrangement (IVA), or a debt management plan. Lenders consider people with a troubled financial history to be a higher risk than those with a squeaky-clean record, and so may not be willing to lend as much for a home loan.
Lenders will ask if you have also been declared bankrupt in the past. If you have, then it’s important to answer honestly, as your chances of getting a mortgage will be zero when they find out you haven’t told the truth.
How have you handled your finances since the repossession?
All lenders will be most interested in how you have dealt with your financial affairs in the time since your repossession. If you have kept on track with all payments then they will look at you in a far better light. Much more favourable than if you had incurred a further adverse event like a default notice or a CCJ.
If you can demonstrate that, despite problems in the past (which may have been simply a blip due to circumstances beyond your control), you are now on an even keel, a lender will be far more likely to extend lines of credit to you again for a mortgage after repossession.
The state of your current finances
A number of things give indicators of your current financial standing. As ever, the main factor will be the amount of time since your financial problems – the longer ago it happened the less impact it will have.
If you now have fewer financial commitments, a regular income and a clean credit record, then you will be able to borrow more, and with a better deal, than someone who has several financial commitments and/or a blemished credit history.
You can not change what has happened in the past. However, you can look to improve your chances of success. Ensure your credit score is the best it can be and if needed, seek debt advice help.
Getting a mortgage after repossession in the UK: Key Takeaways
- Keep your paperwork: Ensure you have your paperwork from when the repossession occurred. This will help validate any dates and reasons if required.
- Be honest: Ensure you provide the true situation when applying. Honesty really is the best policy in these situations.
- Maintain your credit agreements post repossession: Try to demonstrate that all has been better financially since the time of the repossession.
- Don’t overstretch yourself: Try to look at the purchase price and in turn loan size well within your affordability. You can always upsize when you have a new mortgage payment track record.
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FAQs: Getting a mortgage after repossession
Under normal conditions, you may be able to borrow up to five times your annual income. This is if you have a clean credit record and make regular, timely payments.
With every mortgage application, lenders will conduct an affordability assessment, as well as checks on your borrowing and spending. The longer ago your repossession happened, the more beneficial it will be for you. Especially if you have maintained a good credit score since then.
Generally, you might be able to borrow around three times your annual income one to three years after your repossession. Perhaps four times your income when three to six years have elapsed. Lenders are more flexible after six years. You should then be able to get deals on a par with high street rates.
Having a blemish on your financial record will likely mean needing a larger deposit for a mortgage. And the more recently your issue occurred, the larger the deposit the lender may ask for. Here, we’ll go through what you’re probably going to have to deal with when trying to get a mortgage after repossession.
Firstly, there is almost no point in applying for a new mortgage within a year of the repossession. It’s just too soon after the fact.
If you apply for a mortgage shortly after a repossession, lenders will usually require a minimum 30% deposit. This applies if the repossession occurred within one to three years. After three years, lenders become more flexible, with most asking for 20% of the property value. After six years you can expect things to return to somewhere near normal, with 10% being typical.
If the repossession happened less than three years ago, you will likely be badly hit by a very high interest rate compared to a standard loan. Lenders can be very cautious, and will charge a high rate of interest to people who they perceive as being a greater lending risk. After three years, you will probably be able to get a slightly better interest rate offered, but it is only after four years or more that the interest might get close to a competitive market rate – especially if you have been able to maintain a healthy credit history since then and have a decent-sized deposit to put down.
As ever with adverse credit events, the longer ago they happened, the less negative impact they will have on your credit score, and the opinions of lenders. However, if you had a property repossessed in the last year, then your chances of obtaining a mortgage are almost none. You will need to wait until the one-year threshold has passed, and in the meantime take steps to demonstrate your good money management and improve your credit history.
You don’t necessarily need to do this, but it will probably help your case. An outstanding balance after a repossession can affect your new mortgage application in three ways:
- It will affect your chances of being made an offer. Many lenders will simply reject an application outright if there is still debt outstanding on a previous mortgage. Also, if you are still paying off the debt and have heavy financial commitments each month, this will impact an affordability assessment when they come to work out how much you could pay for a new mortgage.
- You will be asked to put down an even larger deposit. After a repossession, you would need to fund a big deposit for a new mortgage anyway – applying with more debt still outstanding might mean this needs to be increased again.
- You will probably have to pay a higher rate of interest on the loan, simply because with more debts outstanding on top of the repossession, you will pose a greater risk to the lender.
If you do pay off the balance, make sure your credit record get updated accordingly.
Repossession, like bankruptcy, is viewed as a very serious adverse credit event, and if you are asked about it, then you must reply honestly. Just because it now falls outside of the six-year scope of a credit check, this does not mean records no longer exist, and lenders will not react well when they find out about an event you did not mention that they asked you directly about. This could put your mortgage, and therefore your home, at risk.
About the author
Phil Scott: Director
Phil has worked in the financial services industry since 1992, having started with a large insurance company. He went self employed in 1996 as an Independent Financial Adviser before setting up his first company, Needham Market Home Financial in 1999.
After four years, he decided to concentrate solely on mortgages and related insurances, and The Mortgage Centres was born. Since then, Phil has been influential in the opening of several new offices as the business continues to grow.
Qualifications:
- Financial Planning Certificate: 1, 2 & 3 | Year Attained: 1992
- Certificate in Mortgage Advice and Practice (CEMAP) | Year Attained: 2001
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