---
title: "Mortgages with Defaults, Lender Tiers and Secured Defaults"
description: "Mortgages with defaults: which lenders accept them, how date, value and settled status set the tier, and why a default on a mortgage counts for more."
url: "https://mortgagelane.com/mortgages/mortgages-with-defaults"
site: "Mortgage Lane"
collection: "mortgages"
date: "2026-10-06"
author: "Joseph Lane"
category: "Mortgages"
reviewed: "2026-10-08"
reading_time: "36 min"
byline: "Joseph Lane"
author_credentials: "CeMAP · FCA authorised firm"
language: "en-GB"
robots: "index,follow"
---

# Mortgages with Defaults, Lender Tiers and Secured Defaults

Mortgages with defaults: which lenders accept them, how date, value and settled status set the tier, and why a default on a mortgage counts for more.

Mortgages with defaults: which lenders accept them, how date, value and settled status set the tier, and why a default on a mortgage counts for more.

[Default (credit file)](https://mortgagelane.com/definitions?term=credit-default)

Lending and affordability

A record a lender files with the credit reference agencies when it considers that a credit agreement has broken down, usually after several months of missed payments. It stays on the credit file for six years from the default date, whether or not the debt is repaid.

[Read the full definition of Default (credit file)](https://mortgagelane.com/definitions?term=credit-default)

## Expert advice on mortgages with defaults

Speak to a Mortgage Lane adviser about your options.

## In short

Getting a mortgage with a default is possible, although the default changes which lenders will consider you, the deposit you need and the rate. Lenders look at when each default was registered, its size, whether it is settled and what kind of account it was on. A default on a mortgage or secured loan counts against you far more than one on a phone contract or credit card.

## What is a mortgage with defaults?

**A mortgage with defaults is a residential or [buy to let](https://mortgagelane.com/definitions#def-buy-to-let-mortgage) mortgage for a borrower whose credit file shows one or more defaults, from a lender whose criteria accept defaults of that age, number, value, status and account type.** It is usually arranged with a [specialist lender](https://mortgagelane.com/definitions#def-specialist-lending), priced for the credit history, with a lower maximum [loan to value (LTV)](https://mortgagelane.com/definitions#def-loan-to-value) than a clean credit file would get. Some high street lenders also accept older, smaller, settled defaults through their standard scoring.

A [default](https://mortgagelane.com/definitions#def-credit-default) is the record a lender files with the [credit reference agencies](https://mortgagelane.com/definitions#def-credit-reference-agency) to show it considers the relationship with the borrower has broken down. Under the industry principles drawn up with the Information Commissioner's Office (ICO), a lender may file a default once an account is 3 months in arrears, and normally does so by the time it is 6 months in arrears. It must give at least 28 days' notice first ([Principles for the reporting of arrears, arrangements and defaults](https://www.cigb.co.uk/wp-content/uploads/2026/07/Principles-for-the-Reporting-of-Arrears-Arrangements-and-Defaults-at-Credit-Reference-Agencies-v2a.pdf)). Mortgages and other secured or long-term loans are an exception and may be defaulted later. For regulated consumer credit, such as most loans and credit cards, the Consumer Credit Act 1974 also requires a default notice giving at least 14 days to put things right before the lender takes certain action ([Consumer Credit Act 1974, section 88](https://www.legislation.gov.uk/ukpga/1974/39/section/88)). The ICO says a lender can usually still record a default without one, as long as the default reflects what happened and the credit agreement said it could be reported ([ICO: credit](https://ico.org.uk/for-the-public/credit/)).

A default stays on the credit file for six years from the default date, whether or not the debt is later paid. Paying in full changes the status to settled, sometimes shown as satisfied, and a creditor that accepts less than the full balance marks it partially settled; neither shortens the six years. Because the whole record drops off six years after the default date, the date matters. If a default looks to be dated later than it should be, or a debt sold to a collection agency shows up as a second, newer default, raise it with the lender or the credit reference agency, and then with the ICO if it is not put right. A default is also a different entry from a [county court judgment (CCJ)](https://mortgagelane.com/definitions#def-county-court-judgment): the default is the lender's own record, the judgment is a court order, and one debt can carry both.

There is no separate default mortgage product. A mortgage on a home you or a close relative will live in is normally a [regulated mortgage](https://mortgagelane.com/definitions#def-regulated-mortgage) under the Financial Conduct Authority's [MCOB](https://handbook.fca.org.uk/handbook/mcob) rules, and most buy to let lending is unregulated, apart from [consumer buy to let](https://mortgagelane.com/definitions#def-consumer-buy-to-let-mortgage). Mortgage Lane arranges these cases for purchases, [remortgages](https://mortgagelane.com/definitions#def-remortgage), first-time buyers, landlords and joint applications where one applicant has the defaults. That includes settled and unsettled defaults, recent and older ones, and defaults on a mortgage or secured loan.

## Mortgage rates with defaults

**Rates for borrowers with defaults are set by the loan to value, as on any mortgage, and by the tier the lender places the credit history in.** Older, smaller, settled defaults on unsecured accounts can be priced close to a clean file, and at some high street lenders they sit on standard products. Recent, multiple, unsettled or secured defaults are priced at the specialist end of the market, with a lower maximum loan to value and sometimes higher fees.

A default counts for less as it ages, so the length of the first deal is worth choosing with the next remortgage in mind. A shorter [fixed rate](https://mortgagelane.com/definitions#def-fixed-rate-mortgage) can end once the defaults are old enough for a wider choice of lenders, while an [early repayment charge](https://mortgagelane.com/definitions#def-early-repayment-charge) on a longer one can make an earlier move expensive.

**Defaults on your file and a purchase or remortgage in mind?** Get in touch with a copy of your credit report showing each default's date, amount and status, and the kind of account it was on. Those four facts decide which lenders will look at the case, and whether any default was on a mortgage changes the answer most.

## Mortgage with defaults criteria

Each lender sets its own rules on defaults, and the table shows how those rules vary, as at October 2026. The six-year line comes from the industry principles agreed with the ICO, the remortgage line from the FCA's rules and the buy to let line from the PRA's standards. The loan to value, income and term lines are Mortgage Lane's experience on the cases we arrange. The other lines describe the range across lenders.

## Mortgage with defaults criteria

*Mortgage with defaults criteria*

| Criterion | How it varies |
| --- | --- |
| Date registered | Lenders count the months since each default was registered. Each sets its own look-back period and limits, and the choice of lender widens as defaults age. |
| Number | Some lenders set a maximum number of defaults in their look-back period; others have no fixed cap and read the whole file. The limits vary by lender. |
| Value | Some lenders ignore defaults below a set amount, and the amount varies by lender. Larger totals narrow the choice. |
| Status | Settled defaults are accepted by more lenders. Some lenders consider unsettled defaults; others want them paid before completion. |
| Account type | Some lenders ignore or discount telecoms, utility and mail order defaults. A default on a mortgage or secured loan is assessed separately and more strictly. |
| Mortgage arrears | Months in arrears on a mortgage or secured loan are a separate criterion with their own look-back period, whether or not a default was filed. The limits vary by lender. |
| Repossession | Some lenders decline any history of repossession; others consider one after a set period, which varies by lender. |
| Loan to value | The maximum falls as the credit history gets heavier. In our experience adverse credit cases usually reach at most 90%. |
| Income | In our experience up to 5 times gross income less commitments as standard, and up to 6 times for professionals and some specialist products. Each lender sets its own limit. |
| Term and age | In our experience terms run to 40 years. Some lenders set no maximum age at the end of the term, and others cap it at 85. |
| Other adverse credit | CCJs, missed payments, arrangements to pay, debt management plans, IVAs and bankruptcy are assessed alongside the defaults. |
| Joint applications | Both applicants' credit files are checked, and one applicant's defaults apply to the whole application. |
| Remortgage | A remortgage to a new lender is assessed like a purchase. A product transfer with the current lender, with no extra borrowing and no other change that matters for affordability, needs no new affordability assessment under the FCA's rules. |
| Buy to let | Assessed mainly on the rent under the PRA's underwriting standards, with the lender's credit rules applied as well. |
| After six years | The default leaves the credit file 6 years after the default date. Some application forms still ask about past credit problems or repossessions, and the answers must be truthful. |

How lender criteria vary, with three lines from published rules and three from Mortgage Lane's experience on the cases we arrange. Checked 6 October 2026. Each lender's current criteria decide a case.

## How mortgage lenders assess defaults

**Lenders place each default on a grid of date, number, value, status and account type, and where it lands decides the lender, the maximum loan to value and the price.** The date carries the most weight. A default registered in the last 12 months gives the narrowest choice. Between one and three years old, more specialist lenders will usually consider it, and once it is over three years old and settled it may fall within some high street lenders' standard scoring. Lenders that limit defaults usually count them over a set look-back period, for example the last 12, 24 or 36 months, and the periods differ by lender.

The number and total value of the defaults then adjust the tier. One small settled default can look close to a clean file at some lenders, while several, or a large total, move the case to a heavier tier with a lower maximum loan to value. Settled defaults are accepted more widely, and lenders that accept unsettled ones may ask for them to be paid before completion.

Account type also changes the result. Some lenders ignore or discount defaults on telecoms, utility and mail order accounts, treating a disputed phone bill as less telling than an unpaid loan. Defaults on credit cards, loans and other unsecured credit are tiered as above. A default on a mortgage or secured loan is assessed on its own, stricter scale, covered in the next section.

High street lenders apply the same facts through automated [credit scoring](https://mortgagelane.com/mortgages/low-credit-score-mortgages), so a default that a specialist lender's [underwriter](https://mortgagelane.com/definitions#def-underwriting) would accept can fail a high street score without anyone looking at the case. The high street mortgage lenders that accept defaults therefore usually accept only old, small, settled defaults on unsecured credit. Our guide to a [mortgage declined on credit score](https://mortgagelane.com/guides/declined-mortgages/mortgage-declined-on-credit-score) covers what happens after a scoring decline. Lenders also read the rest of the file: other [adverse credit](https://mortgagelane.com/definitions#def-adverse-credit) such as [missed payments](https://mortgagelane.com/definitions#def-missed-payment) or CCJs, how accounts have been run since the default, and the level of existing debt, which feeds into [affordability](https://mortgagelane.com/definitions#def-affordability).

On an illustrative £250,000 purchase, a light tier with a 90% maximum needs a £25,000 deposit while an assumed heavy tier at 75% needs £62,500, so where a default lands can move the deposit by £37,500.

## Why a default on a mortgage is judged more harshly

**For new lending, a default on a mortgage or secured loan is one of the most serious entries a credit file can carry short of [bankruptcy](https://mortgagelane.com/definitions#def-bankruptcy), and lenders treat it as a separate category from a default on unsecured credit.** A mortgage is the debt most borrowers protect above all others, so a record that it went unpaid suggests to a new lender that other commitments came under strain first. Under the principles agreed with the ICO, a default on most accounts may be filed from 3 months in arrears and normally by 6 months, while mortgages and other secured loans may be defaulted later. A home repossessed or handed back with no indication that the remaining balance will be paid can itself lead to a default ([reporting principles](https://www.cigb.co.uk/wp-content/uploads/2026/07/Principles-for-the-Reporting-of-Arrears-Arrangements-and-Defaults-at-Credit-Reference-Agencies-v2a.pdf)). A mortgage default therefore usually sits on top of a longer run of missed payments, and sometimes a repossession, where an unsecured default can follow a few months of arrears.

High street lenders may decline any recent arrears on a mortgage or secured loan, specialist lenders assess secured arrears as their own criterion with their own look-back period, and a repossession is a separate category with its own exclusion period, all set lender by lender. A borrower with an 18-month-old default on a credit card can sit in a light tier, while the same borrower, with the same deposit and a mortgage default of the same date, can be declined or placed in the heaviest tier (Step 3 of the arithmetic below). If any default on your file was on a mortgage or secured loan, it is the first thing a lender will want to understand, with the full arrears history, the reason and, where the mortgage was repaid on a sale, evidence of how the balance was cleared.

UK Finance's quarterly arrears and possessions figures give a measure of mortgage default rates in the UK. In the second quarter of 2026 it counted 77,940 homeowner mortgages in arrears of 2.5% or more of the balance, 0.89% of all homeowner mortgages, against 0.44% of buy to let mortgages. Homeowner possessions numbered 1,150 in the quarter ([UK Finance: arrears and possessions](https://www.ukfinance.org.uk/data-and-research/data/arrears-and-possessions), published 13 August 2026).

### If you are behind on your current mortgage

This page is about new mortgage options for people whose credit files show defaults. It is not guidance on an existing mortgage that is in arrears or in default, which is a matter between you and that lender. If you are in that position, contact the lender. On a regulated mortgage, the FCA's rules require it to deal fairly with customers in payment difficulty and to consider options such as extending the term or changing the type of mortgage, and it must not repossess unless all other reasonable attempts to resolve the position have failed ([FCA Handbook, MCOB 13.3](https://handbook.fca.org.uk/handbook/MCOB/13/3.html)). Lenders that have signed the Mortgage Charter 2026, around 90% of the market, have also committed that a borrower will not be forced out of their home without consent within a year of the first missed payment, except in exceptional circumstances ([gov.uk: Mortgage Charter 2026](https://www.gov.uk/government/publications/mortgage-charter-2026/mortgage-charter)). For free, confidential debt advice, MoneyHelper's [debt advice locator](https://www.moneyhelper.org.uk/en/money-troubles/dealing-with-debt/debt-advice-locator) lists advisers near you and online.

In England and Wales a debt adviser can start a Breathing Space, which pauses most creditor enforcement action and most interest and charges for 60 days, although ongoing mortgage payments still have to be made ([gov.uk: Breathing Space guidance](https://www.gov.uk/government/publications/debt-respite-scheme-breathing-space-guidance/debt-respite-scheme-breathing-space-guidance-for-creditors)). Scotland has its own six-month moratorium ([mygov.scot: apply for a moratorium](https://www.mygov.scot/apply-for-moratorium)).

## Types of default case, and where each sits

**Where a default leaves you depends on its age and status, and above all on whether it was on a mortgage or on unsecured credit.**

### Defaults over two years old

Two years is often where more specialist lenders' lighter tiers open and, if the default is small and settled, where some high street lenders' scoring may accept it. Lenders look at the conduct since as well as the age, and two years of accounts run without further missed payments carry weight. An unsettled default of this age may still need paying before some lenders will lend.

### Recent defaults, under 12 months

A default registered in the last 12 months gives the narrowest choice. A small number of specialist lenders may consider it, usually in their heaviest tier with the lowest maximum loan to value, and many other lenders decline it. The choice widens once the default passes 12 months. A purchase that cannot wait can go to a heavier-tier lender now, with a plan to remortgage once the default is older.

### Settled and unsettled defaults

Settling a default changes its status, and its dates stay the same: it still leaves the file six years after the original default date, even if the debt is paid years later. Settling can still move the application to a lighter tier. Settled defaults are accepted by more lenders and priced better, and lenders that accept unsettled defaults may ask for them to be paid before completion. A partially settled default, where the creditor accepted less than the full balance, usually sits between the two.

### Multiple defaults

Several defaults are assessed on their number, total value and dates together. Three small settled defaults from one period of difficulty some years ago can sit in a lighter tier than two recent unsettled ones. Lenders that cap the number or total value of defaults set their own limits, and the maximum loan to value usually falls as the count rises. A short explanation of what caused the defaults, with evidence that it has passed, helps the underwriter.

### Small defaults: telecoms, utilities and mail order

Some lenders ignore defaults below a set amount, and some ignore or discount defaults on telecoms, utility and mail order accounts. The threshold, and which account types count, vary by lender. A small default that is settled and more than a year old can be close to a clean file at some lenders. It still has to be declared if the application asks, and a lender that does not ignore it will tier it like any other default.

### Defaults and a debt management plan

A [debt management plan (DMP)](https://mortgagelane.com/definitions#def-debt-management-plan) is an agreement with creditors to repay unsecured debts in affordable monthly amounts, usually set up through a debt adviser. Unless the agreement says otherwise, creditors can still ask for the full debt later ([gov.uk: debt management plans](https://www.gov.uk/options-for-dealing-with-your-debts/debt-management-plans)). Accounts in a plan are marked as such on the credit file, in a similar way to an [arrangement to pay](https://mortgagelane.com/definitions#def-arrangement-to-pay), and arrears can continue to be counted against the original terms, so defaults can appear alongside a plan. Lenders' rules on plans vary: some decline an active plan, while some specialist lenders consider an active or completed one, counting the monthly payment on an active plan as a commitment. In Scotland the statutory route is a debt payment programme under the Debt Arrangement Scheme ([mygov.scot: Debt Arrangement Scheme](https://www.mygov.scot/what-is-das)). A formal insolvency is a different case: see [IVA mortgages](https://mortgagelane.com/mortgages/iva-mortgages) and [mortgages after bankruptcy](https://mortgagelane.com/mortgages/bankruptcy-mortgages).

### Secured defaults and mortgage arrears history

A default on a mortgage or secured loan, or a record of mortgage arrears without a default, is assessed on its own scale, as set out in the section above. A repossession carries an exclusion period set by each lender, after which a few specialist lenders may consider the case. A larger deposit matters most in these cases, because the heavier tiers come with lower maximum loans to value.

### Defaults with CCJs

A default and a CCJ, whether on the same debt or different debts, are assessed together, with the judgment's date and status added to the grid. The industry principles allow a default to be registered on a debt the lender has also pursued through a CCJ, or a decree in Scotland. Settling the default and paying the judgment before applying can move the case to a lighter tier. In England and Wales a judgment stays on the register for six years unless it is paid in full within a month ([gov.uk: county court judgments](https://www.gov.uk/county-court-judgments-ccj-for-debt)); our [CCJ mortgages](https://mortgagelane.com/mortgages/ccj-mortgages) page covers the register in detail.

### Joint mortgage where one applicant has defaults

A [joint mortgage](https://mortgagelane.com/definitions#def-joint-mortgage) application is assessed on both credit files, and one applicant's defaults place the whole application in their tier. The options are a joint application with a lender that accepts that tier, or a sole application by the applicant with the clear file, on their income alone, which works where that income supports the loan: see [single person mortgages](https://mortgagelane.com/mortgages/single-person-mortgages). A [joint borrower sole proprietor](https://mortgagelane.com/definitions#def-joint-borrower-sole-proprietor) arrangement, where a relative joins the mortgage but not the ownership, adds income, but every borrower on the mortgage is credit checked, so it does not get round one applicant's defaults ([JBSP mortgages](https://mortgagelane.com/mortgages/jbsp-mortgages)).

### Remortgaging with defaults

A remortgage to a new lender is assessed under the same tiers as a purchase, with the equity in the home acting as the deposit, and a clean payment record on the current mortgage helps. A [product transfer](https://mortgagelane.com/definitions#def-product-transfer) to a new deal with your current lender, with no extra borrowing and no other change that matters for affordability, does not need a new affordability assessment under the FCA's rules ([MCOB 11.6.3](https://handbook.fca.org.uk/handbook/MCOB/11/6.html)). That can make it the simpler route where the defaults came after the mortgage started and the mortgage itself has been paid on time. Some specialist lenders allow extra borrowing to settle the defaults, which is a form of [remortgaging for debt consolidation](https://mortgagelane.com/mortgages/debt-consolidation-mortgages) and secures that debt on your home. Our [remortgage with bad credit](https://mortgagelane.com/mortgages/remortgage-with-bad-credit) page compares these routes.

### First-time buyers with defaults

A first-time buyer with defaults can use the same routes as any other buyer, within the maximum loan to value of the tier. In our experience adverse credit cases usually reach at most 90% loan to value, so 95% lending rarely fits. The government's [Mortgage Guarantee Scheme](https://mortgagelane.com/definitions#def-mortgage-guarantee-scheme) covers loans of 91% to 95%, and its rules exclude borrowers they class as credit-impaired. That includes anyone who has owed arrears equal to 3 months' payments on a mortgage or other loan in the 2 years before completion ([gov.uk: 2025 Mortgage Guarantee Scheme](https://www.gov.uk/government/publications/2025-mortgage-guarantee-scheme), rules Schedule 2). A default registered in that period will usually have followed arrears of that size. [Shared ownership](https://mortgagelane.com/definitions#def-shared-ownership) reduces the mortgage to the share you buy, and in our experience lenders want at least a 10% deposit on the share. Family help, such as a [gifted deposit](https://mortgagelane.com/definitions#def-gifted-deposit) or a parent's savings held as security, can bring the loan to value down into a wider tier. See [shared ownership mortgages](https://mortgagelane.com/mortgages/shared-ownership-mortgages), [family help mortgages](https://mortgagelane.com/mortgages/family-help-mortgages), [95% mortgages](https://mortgagelane.com/mortgages/95-percent-mortgages) and the [first-time buyer mortgage guide](https://mortgagelane.com/guides/first-time-buyer-mortgage-guide).

### Buy to let with defaults

Specialist buy to let lenders accept defaults within their tiers. The loan is still assessed mainly on the rent, under the Prudential Regulation Authority's underwriting standards ([PRA SS13/16](https://www.bankofengland.co.uk/prudential-regulation/publication/2016/underwriting-standards-for-buy-to-let-mortgage-contracts-ss)), with the tier setting the price and the maximum loan to value. Secured arrears and repossessions are generally treated as seriously on buy to let as on a home. [Portfolio landlords](https://mortgagelane.com/definitions#def-portfolio-landlord) are assessed across the whole portfolio, and the mechanics are in the [buy to let mortgage guide](https://mortgagelane.com/guides/buy-to-let-mortgage-guide). Commercial mortgages are assessed case by case on the property and the business, with the credit history weighed alongside them: see the [commercial mortgage guide](https://mortgagelane.com/guides/commercial-mortgage-guide).

### After six years

Six years after the default date the default leaves the credit file, and lenders no longer see it in their searches. Some application forms still ask about past credit problems or whether a property has ever been repossessed, and those questions must be answered truthfully. From then on, a file that has stayed clear since the default is assessed like any other.

## How a mortgage with defaults is arranged

1. **The file.** Credit reports from the three main credit reference agencies, Equifax, Experian and TransUnion, since lenders do not all use the same one; each default's date, amount, status and account type; any mortgage arrears or repossession history; what happened; whether to settle anything before applying; and whether any default date looks wrong.
2. **Tier and lender.** The tier the defaults fall into; a lender whose tiers accept it, checked against its secured arrears rules where any default was on a mortgage, its maximum loan to value and its pricing; the deposit checked against that maximum.
3. **Agreement in principle and full application.** An [agreement in principle](https://mortgagelane.com/definitions#def-agreement-in-principle) with the defaults disclosed; the full application with settlement evidence and the explanation; the lender's valuation.
4. **Offer, completion and the next step.** The mortgage offer and completion, with the length of the deal chosen so that the remortgage falls after the defaults have aged into a lighter tier.

## The default arithmetic: two clocks and two ledgers

**A default runs on two clocks: the six years it stays on the credit file, and each lender's look-back periods.** It also sits on one of two ledgers, unsecured or secured, and the deposit then decides which tiers you can use.

### Step 1. The credit file's clock

These dates come from the industry principles agreed with the ICO and apply across the UK. Paying the debt does not move them.

## How a default moves through the credit file

*How a default moves through the credit file*

| Stage | What the credit file shows |
| --- | --- |
| Arrears | Missed payments are reported month by month as the account falls behind. |
| Arrangement to pay, if agreed | Shown on the file. While it is kept to, a default is not normally filed. |
| Notice of default | The lender gives at least 28 days' notice that it intends to file a default, except in cases such as fraud or an insolvency. |
| Default date | For most accounts, from 3 months in arrears and normally by 6 months. Mortgages and other secured loans may be defaulted later. |
| Settlement, at any later date | Status changes to settled, or partially settled if the creditor accepts less than the full balance. The default date does not change. |
| 6 years from the default date | The default is removed from the file, paid or not. |

From the Principles for the reporting of arrears, arrangements and defaults at credit reference agencies (version 2a), checked 6 October 2026.

### Step 2. The lenders' clock

Lenders that tier defaults by age count the months since each default was registered, and each sets its own periods. The table shows the general pattern of how the choice of lender changes as a default ages. It is not any lender's criteria, and some lenders do not tier by age at all.

## How the choice of lender changes with age

*How the choice of lender changes with age*

| Age of the default | How the choice of lender tends to change |
| --- | --- |
| Under 12 months | Narrowest choice: some specialist lenders, usually in their heaviest tiers with the lowest maximum loan to value |
| 12 to 24 months | More specialist lenders, with settled defaults usually priced better than unsettled ones |
| 24 to 36 months | Lighter specialist tiers; some high street scoring may accept a small settled default |
| Over 36 months, settled | Some high street lenders on standard criteria, and the lightest specialist tiers |
| 6 years or more after the default date | No longer on the credit file |

A general pattern, not any lender's criteria, as at October 2026. Each lender sets its own periods, counts and values, and some have none.

### Step 3. The two ledgers

Take one borrower, with the same deposit, and three different histories, each 18 months old. One history is unsecured and two are on a mortgage.

## Three histories, each 18 months old

*Three histories, each 18 months old*

| History, 18 months old | Account type | How lenders tend to treat it |
| --- | --- | --- |
| One settled default of £800 on a credit card | Unsecured | A light to middle tier at many specialist lenders; some high street scoring may accept it |
| Three months of mortgage arrears, now cleared, with no default | Secured, arrears | Often declined by high street lenders; considered by some specialist lenders whose look-back rules allow it, in a middle to heavy tier |
| A default on a mortgage, followed by a sale or repossession | Secured, default or repossession | Declined by some lenders while it is on the file; a few specialist lenders may consider it in their heaviest tier, with a low maximum loan to value, usually only after a longer wait |

Illustrative histories and a general pattern of treatment, not any lender's criteria.

### Step 4. What the deposit decides

An illustrative £250,000 purchase, with an assumed maximum loan to value for each of three tiers. The 90% top figure reflects our experience that adverse credit cases usually reach at most 90%; the 85% and 75% figures are assumptions chosen to show the arithmetic, not any lender's terms.

## Step 4 figures

*Step 4 figures*

| Tier, illustrative | Maximum loan to value, assumed | Maximum loan | Deposit needed |
| --- | --- | --- | --- |
| Light: one small settled unsecured default over 24 months old | 90% | £225,000 | £25,000 |
| Middle: a settled default 12 to 24 months old, or a small unsettled one | 85% | £212,500 | £37,500 |
| Heavy: a default under 12 months old, several defaults, or a secured default | 75% | £187,500 | £62,500 |

Illustrative arithmetic on a hypothetical £250,000 purchase. The 90% top figure is Mortgage Lane's experience of adverse credit cases; the 85% and 75% figures are assumptions, not product terms or any lender's tiers. Affordability, fees and the lender's valuation are ignored. Not an offer of finance.

A buyer who has saved £37,500 meets the middle tier exactly and has £12,500 to spare at the light tier, but falls £25,000 short at the heavy tier, which is where a secured default is likely to sit, if a lender accepts it at all. Income sets a second limit: on an illustrative £50,000 income with no other credit payments, 5 times income, the standard [income multiple](https://mortgagelane.com/definitions#def-loan-to-income) in our experience, gives up to £250,000, so in this example the deposit sets the limit. Counting £300 a month of loan payments as a commitment brings the income figure down to £232,000. The calculator below runs the same arithmetic on your own figures.

### Step 5. The two-step route

A borrower whose unsecured default is 18 months old takes a specialist mortgage with a two-year fixed rate. When it ends, the default is three and a half years old and the file has two more years of clear conduct, so the remortgage may go to a lighter tier or to a high street lender. The first mortgage is chosen partly for the move it allows at the end. For a secured default the same route usually takes longer, because lenders' look-back periods for secured arrears and repossessions tend to be longer.

### What decides the case

The dates, amounts, statuses and account types of the defaults are fixed. Whether you settle them, the size of the deposit and the timing can still change, and a broker matches the case to a lender whose tiers fit. Start with the credit file, and with which account each default sits on.

For missed payments without a default, see [mortgages with missed payments](https://mortgagelane.com/mortgages/mortgages-with-missed-payments); for the steps after a refusal, [declined mortgages](https://mortgagelane.com/insights/declined-mortgages); where income and credit both need placing, [low income mortgages](https://mortgagelane.com/mortgages/low-income-mortgages); and for the deposit bands, [85% LTV mortgages](https://mortgagelane.com/mortgages/85-ltv-mortgages) and [90% LTV mortgages](https://mortgagelane.com/mortgages/90-ltv-mortgages).

## Related topics

- [2026](https://mortgagelane.com/mortgages/low-income-mortgages)Mortgage[Low Income Mortgages, Benefits, Schemes and Borrowing](https://mortgagelane.com/mortgages/low-income-mortgages)How to get a mortgage on a low income: what a modest salary can borrow, which benefits lenders count, and how schemes, longer terms and family help stretch it.[Read more about Low Income Mortgages, Benefits, Schemes and Borrowing](https://mortgagelane.com/mortgages/low-income-mortgages)
- [2026](https://mortgagelane.com/mortgages/90-ltv-mortgages)Mortgage[90% LTV Mortgages](https://mortgagelane.com/mortgages/90-ltv-mortgages)90% LTV mortgages: 10% deposit residential lending, rates by tier, flats, new builds and remortgages at 90%, and the answer on 90% buy to let.[Read more about 90% LTV Mortgages](https://mortgagelane.com/mortgages/90-ltv-mortgages)
- [2026](https://mortgagelane.com/mortgages/bad-credit-buy-to-let-mortgages)Mortgage[Bad Credit Buy to Let Mortgages, Defaults, CCJs and Arrears](https://mortgagelane.com/mortgages/bad-credit-buy-to-let-mortgages)Bad credit buy to let mortgages: how defaults, CCJs, missed payments and insolvency change the lender, deposit and rate for personal and company landlords.[Read more about Bad Credit Buy to Let Mortgages, Defaults, CCJs and Arrears](https://mortgagelane.com/mortgages/bad-credit-buy-to-let-mortgages)

## Mortgage with defaults calculator

Enter the price, your deposit and the highest loan to value a lender offers for your credit history, such as the 90%, 85% and 75% used in the example above, to see the deposit it needs and any shortfall. Your income and credit payments give the maximum loan on income, and the payment uses the rate you enter. Starting figures are the page illustration: a £250,000 purchase with a £37,500 deposit at 85%.

Explore your borrowing

Start again

Enter your figures in pounds. Your estimate updates as you go.

Indicative maximum loan

\-

Enter your figures to see an estimate.

Loan to value

[Discuss your options](https://mortgagelane.com/contact)

Indicative estimate only, subject to lender criteria, affordability and valuation. Each lender sets the highest loan to value for a credit history, and the figure you enter is your own assumption. This is not a mortgage offer. Your home may be repossessed if you do not keep up repayments on your mortgage.

## Frequently asked questions about mortgages with defaults

**Q: Can I get a mortgage with a default?**

faq-id: can-i-get-a-mortgage-with-a-default

Yes, a mortgage with a default on your credit file is possible. Specialist lenders consider defaults within tiers set by when each default was registered, how many there are, their value, whether they are settled and what kind of account they were on, and some high street lenders accept a default that is small, settled and a few years old. The tier sets the price and the maximum loan to value, so the deposit you have often decides which lenders can help. A default on a mortgage or secured loan is judged much more strictly than one on a phone contract, credit card or loan.

**Q: Will I get a mortgage with defaults?**

faq-id: will-i-get-a-mortgage-with-defaults

Whether you get a mortgage with defaults depends on their dates, amounts, status and account type, and on your deposit and income. An old, small, settled default on unsecured credit can be accepted by a wide range of lenders. A recent or unsettled default narrows the choice to specialist lenders, usually at a higher rate and a lower maximum loan to value. A default on a mortgage or secured loan is accepted by few lenders until it has aged. No lender can confirm a decision before it has seen the full application and credit file.

**Q: How do you get a mortgage with defaults?**

faq-id: how-do-you-get-a-mortgage-with-defaults

You get a mortgage with defaults by starting with your credit file. Check each default's date, amount, status and account type with the credit reference agencies, settle what you can, and challenge any default that is wrong or wrongly dated. Then build the deposit the likely tier needs and apply to a lender whose criteria accept that tier, disclosing the defaults and explaining what caused them. Applying to lenders whose criteria do not fit risks a decline and another search on your file, so the lender is chosen before the application goes in.

**Q: Can high street lenders approve mortgages with defaults?**

faq-id: can-high-street-lenders-approve-mortgages-with-defaults

Yes, some high street lenders approve mortgages with defaults, within their automated credit scoring. That usually means a small, settled default on unsecured credit registered more than two or three years ago, with a clear record since. Recent, multiple, unsettled or secured defaults usually fall outside high street scoring, and because the decision is automated there is often no underwriter to make an exception. Specialist lenders assess those cases by hand within their own tiers, and they are where most borrowers with recent or heavier defaults are placed.

**Q: Which lenders accept defaults?**

faq-id: which-lenders-accept-defaults

Specialist mortgage lenders accept the widest range of defaults, assessing each case by hand within tiers set by the age, number, value, status and account type of the defaults. Some high street lenders accept older, smaller, settled defaults through their standard scoring. Lenders' rules differ and change, and there is no single published list of lenders that accept defaults, so the lenders that fit depend on your credit file, your deposit and your income. A broker compares the current criteria of the lenders whose tiers fit before an application is made.

**Q: Can I get a mortgage with a default over 2 years old?**

faq-id: can-i-get-a-mortgage-with-a-default-over-2-years-old

Yes, a default over two years old opens up more of the market. Specialist lenders' lighter tiers often start around two years, and where the default is small, settled and on unsecured credit, some high street lenders' scoring may accept it. Lenders also look at how your accounts have been run since, and two years without further missed payments carries weight. An unsettled default of that age may still need paying before some lenders will lend, and a default on a mortgage or secured loan is judged on stricter rules whatever its age.

**Q: How long after a default can I get a mortgage?**

faq-id: how-long-after-a-default-can-i-get-a-mortgage

A mortgage can be possible at any point after a default, and the choice of lenders widens and the price usually falls as the default ages. In the first 12 months only a few specialist lenders may consider it. Between one and three years more specialist lenders will, and after about three years a small settled default may be accepted by some high street lenders. The default leaves your credit file six years after the default date, whether or not it was paid, and lenders look back further for a default on a mortgage or secured loan.

**Q: Can I get a mortgage with a recent default?**

faq-id: can-i-get-a-mortgage-with-a-recent-default

Only a small number of specialist lenders consider a default registered in the last 12 months, usually in their heaviest tier with a lower maximum loan to value, so a larger deposit is usually needed and the rate is usually higher. Lenders want to see that the cause has been dealt with and that other accounts have been kept up since. If the purchase can wait, the choice widens once the default passes 12 months, and again as it ages.

**Q: Is a default on a mortgage worse than other defaults?**

faq-id: is-a-default-on-a-mortgage-worse-than-other-defaults

Yes, a default on a mortgage is judged far more harshly for new lending than a default on a credit card, loan or phone contract, because it shows that a loan secured on a home went unpaid. Under the industry principles agreed with the Information Commissioner's Office, mortgages may be defaulted later than the general guide of 3 to 6 months in arrears for most accounts, so a mortgage default usually follows a long run of arrears and sometimes a repossession. Some lenders decline it while it is on the file, and specialist lenders that consider it place it in their heaviest tiers.

**Q: Can I get a new mortgage after defaulting on a mortgage?**

faq-id: can-i-get-a-new-mortgage-after-defaulting-on-a-mortgage

A small number of specialist lenders accept a previous mortgage default or a repossession, usually once a set period has passed. They place the case in their heaviest tier, with a low maximum loan to value, and ask for the full arrears history, the reason and evidence of how any shortfall was settled. Lenders set their own rules, and some decline a mortgage default for as long as it is on the credit file, which is six years from the default date. A larger deposit and a clear record since the default widen the choice.

**Q: What should I do if I am behind on my mortgage now?**

faq-id: what-should-i-do-if-i-am-behind-on-my-mortgage-now

If you are behind on your mortgage now, contact your lender as soon as you can. Under the FCA's rules a lender must deal fairly with a customer who has or may have payment difficulties on a regulated mortgage ([FCA Handbook, MCOB 13.3](https://handbook.fca.org.uk/handbook/MCOB/13/3.html)), and it can discuss options such as a temporary payment arrangement or a longer term. Free and confidential debt advice is available, and MoneyHelper explains the help you can get ([MoneyHelper: help with mortgage payments](https://www.moneyhelper.org.uk/en/homes/buying-a-home/government-help-if-you-cant-pay-your-mortgage)). Arranging a new mortgage with missed payments on file is a separate question from dealing with arrears on the mortgage you have.

**Q: Are satisfied defaults viewed differently by lenders?**

faq-id: are-satisfied-defaults-viewed-differently-by-lenders

Yes, satisfied (settled) defaults are viewed more favourably than unsatisfied ones. Settling shows the debt has been dealt with, so more lenders accept the default and the pricing is usually better, and some lenders that accept unsettled defaults ask for them to be paid before completion. Settling does not shorten the time the default stays on your credit file, which is six years from the original default date, and a debt settled for less than the full balance is shown as partially settled. Whether to settle before applying is usually the first decision in a defaults case.

**Q: How long does a default stay on your credit report?**

faq-id: how-long-does-a-default-stay-on-your-credit-report

A default stays on your credit report for six years from the default date, whether or not you pay it. Paying changes the status to settled, or partially settled if the creditor accepted less than the full balance, but the six years do not restart or shorten, and after six years the default is removed. Because removal runs from the original default date, a default dated later than it should be, or a sold debt that shows up again with a newer date, can be challenged with the lender or credit reference agency, and then with the Information Commissioner's Office.

**Q: Does the size of a default matter to lenders?**

faq-id: does-the-size-of-a-default-matter-to-lenders

Yes, the size of a default matters. Some lenders ignore defaults below a set amount, and some ignore or discount telecoms, utility and mail order defaults altogether, while larger defaults narrow the choice of lenders and lower the maximum loan to value. The threshold and the account types that count vary by lender. Size is weighed with the default's age and status, so a small default that is settled and more than a year old can be close to a clean file at some lenders, while a large recent one is not.

**Q: Can I get a mortgage with 2 defaults?**

faq-id: can-i-get-a-mortgage-with-2-defaults

Two or more defaults are accepted mainly by specialist lenders whose tiers set a maximum number and total value of defaults within a look-back period. Lenders assess the number, total value and dates together, so three small settled defaults from one period of difficulty some years ago can sit in a lighter tier than two recent unsettled ones. Each additional default usually narrows the choice and lowers the maximum loan to value. An explanation of what caused the defaults, with evidence that it has passed, helps the application.

**Q: Can I get a mortgage with an unsettled default?**

faq-id: can-i-get-a-mortgage-with-an-unsettled-default

Some specialist lenders accept an unsettled default, where its value is within their limits and it was registered long enough ago. Some lenders ask for an unsettled default to be paid before completion, and high street lenders usually decline one. Settling it before you apply can move the application to a lighter tier, although it stays on your credit file for six years from the original default date either way. If you cannot pay it in full, a creditor that agrees to accept less marks the account as partially settled.

**Q: Can you get a mortgage with a CCJ and defaults?**

faq-id: can-you-get-a-mortgage-with-a-ccj-and-defaults

Some specialist lenders consider a county court judgment (CCJ) and defaults together, adding the judgment's date and status to the age, size, status and account type of each default. One debt can carry both a default and a CCJ. Paying the judgment and settling the defaults before you apply can move the case to a lighter tier. In England and Wales a judgment paid in full within one month can be removed from the register; otherwise it stays for six years, as a default does.

**Q: Can you get a joint mortgage if one person has defaults?**

faq-id: can-you-get-a-joint-mortgage-if-one-person-has-defaults

Some lenders accept a joint application where one person has defaults, checking both credit files and placing the whole application in the tier the defaults fall into, so the choice is usually among specialist lenders. The alternative is a sole application by the person with the clear credit file, on their income alone, which can open high street lenders where that income supports the loan. Adding a relative under a joint borrower sole proprietor arrangement adds income, but every borrower on the mortgage is credit checked, so it does not get round the defaults.

**Q: Can I remortgage with defaults?**

faq-id: can-i-remortgage-with-defaults

Remortgaging with defaults is possible. A remortgage to a new lender is assessed under the same tiers as a purchase, with the equity in the property acting as the deposit. A product transfer to a new deal with your current lender, with no extra borrowing and no other change that matters for affordability, does not need a new affordability assessment under the FCA's rules, which can suit defaults registered after the mortgage began where the mortgage itself has been paid on time. Some specialist lenders allow extra borrowing to settle the defaults, which secures that debt on your home.

**Q: Can first-time buyers get a mortgage with defaults?**

faq-id: can-first-time-buyers-get-a-mortgage-with-defaults

Yes, first-time buyers can get a mortgage with defaults, within the maximum loan to value of the tier the defaults fall into. In Mortgage Lane's experience adverse credit cases usually reach at most 90% loan to value, so 95% lending rarely fits, and the Mortgage Guarantee Scheme excludes anyone who has owed arrears equal to 3 months' payments in the 2 years before completion. Shared ownership, a gifted deposit or other family help can bring the loan to value down into a wider tier. Lenders also look at income stability and how accounts have been run since the defaults, and recent or multiple defaults usually mean a specialist lender.

**Q: Can I get a buy-to-let mortgage with defaults?**

faq-id: can-i-get-a-buy-to-let-mortgage-with-defaults

Specialist buy to let lenders that accept defaults offer buy to let mortgages within their tiers. The loan is still assessed mainly on the expected rent against the mortgage interest at a stressed rate: banks and building societies do this under the Prudential Regulation Authority's underwriting standards, and other lenders set their own tests. The tier sets the price and the maximum loan to value. Arrears and defaults on a mortgage, and any repossession, are judged as strictly on buy to let as on a home. A larger deposit and a record of managing property can widen the choice.

**Q: What is the difference between a default and a CCJ?**

faq-id: what-is-the-difference-between-a-default-and-a-ccj

A default is a record a lender files with the credit reference agencies when it considers a credit agreement has broken down, as a general guide once most accounts are 3 to 6 months in arrears. A county court judgment (CCJ) is a court order to pay a debt after a creditor has taken the borrower to court; in Scotland the equivalent is a decree. One debt can carry both. Each stays on the credit file for six years, the default from the default date and the CCJ from the judgment date, unless a CCJ in England and Wales is paid in full within one month. Lenders assess them together.

**Q: Are mortgage rates higher if I have defaults?**

faq-id: are-mortgage-rates-higher-if-i-have-defaults

Yes, mortgage rates are usually higher with defaults, because lenders price for the credit history as well as the loan to value. Older, smaller, settled defaults on unsecured credit can be priced close to a clean file, and at some high street lenders they sit on standard products. Recent, multiple, unsettled or secured defaults are priced at the specialist end of the market, sometimes with higher fees. As the defaults age, a remortgage can move to a lighter tier and better pricing, which is why the length of the first fixed rate matters.

**Q: Can I get a 90% mortgage with a default?**

faq-id: can-i-get-a-90-mortgage-with-a-default

In Mortgage Lane's experience 90% loan to value is usually the most adverse credit cases reach, and it is more likely where the defaults are older, smaller, settled and on unsecured credit. Recent, multiple, unsettled or secured defaults usually need a larger deposit, because lenders' heavier tiers come with lower maximum loans to value. 95% lending is rarely available with a default.

**Q: Can I get a shared ownership mortgage with defaults?**

faq-id: can-i-get-a-shared-ownership-mortgage-with-defaults

Some lenders that accept defaults also lend on shared ownership, applying their own tiers, and both the lender and the housing provider look at your finances. The mortgage covers only the share you buy, so the loan is smaller, and in Mortgage Lane's experience lenders want at least a 10% deposit on the share. Older or settled defaults widen the choice, and a recent or secured default narrows it. The housing provider also checks that you can afford the purchase.

**Q: What deposit do I need with a default?**

faq-id: what-deposit-do-i-need-with-a-default

The deposit you need with a default depends on the tier the defaults fall into, because each tier carries its own maximum loan to value. In Mortgage Lane's experience adverse credit cases usually reach at most 90% loan to value, so a 10% deposit is the usual minimum, and heavier tiers need more. On an illustrative £250,000 purchase, a 90% maximum needs a £25,000 deposit, 85% needs £37,500 and 75% needs £62,500. Recent, multiple, unsettled or secured defaults usually sit in the heavier tiers.

**Q: Can I get a mortgage with a debt management plan?**

faq-id: can-i-get-a-mortgage-with-a-debt-management-plan

Some specialist lenders lend to borrowers with a debt management plan (DMP), depending on whether the plan is active or completed, how long it has run and what defaults sit alongside it. A DMP is an informal agreement to repay unsecured debts. The accounts show on your credit file as being in a plan, and arrears can continue to be recorded against the original terms. Some lenders decline an active plan, and those that consider one count the monthly payment in affordability. A completed plan with a clear record since widens the choice.

## Talk it through with an adviser

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Published: 2026-10-06

Last reviewed: 2026-10-08

Source: https://mortgagelane.com/mortgages/mortgages-with-defaults