Can I get a Mortgage as a discharged bankrupt?
– Yes you CAN get a mortgage as a discharged bankrupt , there will be restrictions on Loan to value and also tighter controls on affordability though.
Let me try and explain…
Firstly you MUST be discharged from the bankruptcy, Mortgage lenders in the UK are NOT allowed to lend to anyone currently still in their bankruptcy period.
If thats all discharged then realistically lenders are going to be cautious over lending – So 1 day discharged bankruptcy and you are only going to get about 60% ltv. So if it was a £100,000 property, the lender would lend you £60,000 maximum, meaning you’d need a £40,000 deposit
If the bankruptcy has been discharged 3 or 4 years then you can get upto 75% of the property price. see the page on deposits and gifted deposits for more information on how to create the deposit required.
and once its over 4 years and you have a good credit score with Experian.co.uk – then you could be looking at 85% mortgage for a discharged bankrupt
Can I get a Mortgage as a discharged bankrupt ? – What is the maximum mortgage I can get ?
Well lenders want to make sure they are ‘lending responsibly’ which they are required to do under FCA rules, so they will be ‘cautious’ when it comes to income multiples, most lenders now tend to use complex affordability formula to work out lending amounts, but as a broad guide, think of it as about 3.0 x annual income. So if you have a joint income of £40,000, then its £40,000 x 3 = £120,000. Thats a broad generalisation and deends on you being young enough to still geta 30 year mortgage, if you’re a bit older then of course the term would reduce to the amount of years between your age and the retirement age
So Can I get a mortgage as a discharged bankrupt ? = YES you can get a mortgage as a discharged bankrupt, but the loan amount will be restrictedand affordability is quite tight.
Can I remortgage to clear the Bankruptcy ?
No you cant uk mortgage lenders are not allowed to lend to people in current bankrupty, it would need to be discharged before any lending could happen.