Income is an irreplaceable factor in importance when you apply for a mortgage. It becomes even more significant if your credit score is poor. The fact is that it is common to find mortgage applicants with high income size, but a bad credit score. Such people are also able to provide large deposits more than the minimum requirement of 5%.

The question is - Do applicants with good income and considerable down payments still need bad credit home loans?

The answer is - Yes, but with the right blend of these two factors as it can compensate for the weakness of bad credit up to a point.

Finance companies want one thing when they offer funds, and that is repayment capacity. That capacity becomes obtainable due to the decent money you earn every month. The question is how that works as the supportive factor.

A mix of varied aspects works together with the income strength to facilitate a mortgage deal. It is beneficial to know about those factors to win approval on mortgage application despite bad credit but you may be earning a good income.

Have you obtained your credit report? NO? Do it now!!

A credit report is the first thing the mortgage lender asks to know how smartly a person uses the income to make different financial decisions. You should always know your exact credit score. Keep a keen eye on it, as this document is the report card of your overall financial behaviour from past to present. It is possible to check your credit report for free from the website of a credit reference agency. Most of the finance companies rely on Experian; here is the link to visit the check the credit report.

Do you know what a bad credit situation is?

You may check your credit report to know if it is good credit score, bad or fair. However, firstly it is necessary to understand what precisely the bad credit situation is. The fact is, making big credit mistakes in the past brings down the credit score. The lenders act reluctant to either extend the loan amount.

Credit Report

Here is a chart from Experian explaining varied scores with their respective credit score performance.

Credit rating Performance
961 - 999 Excellent
881 - 960 Good
721 - 880 Fair
561 - 720 Poor

The last one of 561-720 denotes the poor/bad credit score, which means the person that has a rating between this limit have not handled the financial commitments properly.

Top ways to get a mortgage with bad credit but good income

these ways to get a mortgage with bad credit but good income

1. Seek professional advice regarding your credit report

Now when you have obtained the credit report and also know what a poor credit situation is, advisable is to seek professional advice to see the impact of credit report on your financial life. None of the circumstances of money matters can remain unaffected by credit report. If that is so important, then how can mortgage application decision remain untouched by this?

Through a bit of professional advice, you can know how to improve the report through tailored practices towards the debts and pending obligations. Also, gain knowledge of the facts on how it can work positively with the monthly earning factor. Get to know other elements that affect the financial records besides the pending payments.

For example - Identity theft in which a person steals your identity and commits financial frauds which finally degrades your credit rating. Also, not getting enrolled in the electoral roll with the latest address is a big mistake to do and can affect your credit report badly does not matter how sizeable is the income.

2. Apply with a mortgage lender that does not check credit score

Yes, of course, the first thing that can affect you as a bad credit person is the CREDIT CHECK that leaves a search footprint. In case, your application gets rejected, that is sure to show on your financial records, and with that mark, it is certainly not possible to apply to other lenders. In the end, only disappointment remains as your companion.

To get on safely on the property ladder, it is necessary to find a lender that facilitates no credit check. Awareness to an essential fact is vital here, “no credit check is actually a soft credit check”. It is just the jargon of the mortgage industry that replaces the ‘soft’ word with ‘no’ because; in reality, it literally leaves no footprint. Look for the mortgage lenders that do not go for credit score perusal.

3. Do not apply with lots of lenders

To borrow funds faster, the usual practice of a borrower is to apply to many lenders at the same time. That does not make sense due to a significant threat to the chances of approval. As you can read above the credit check can be a considerable obstacle; multiple mortgage applications can be significant harm. You cannot ask them to change their policy of hard credit check because of your bad credit score.

The best option is to find only the most relatable property lender that offers mortgage funds to the bad credit people. However, this task demands in-depth, expert knowledge of the industry in totality, which you do not have as a person who does not belong to this market.

Why not hire an eagle’s eye? How? Simple, a mortgage broker is the one that owns that capacity. But it should be equipped with experience and skills. Shine Mortgages can qualify on this criterion with its 15 years of existence in the industry and thousands of satisfied customers. We are a free online broker with 90+ lenders.

We bring you loan deals nearest to base rate of 0.75%.

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  • Talk to us
    We have a customer support round the clock. Communicate with us and know which type of mortgage you can qualify for. We will also ponder over the reasons for your poor credit history to update you how you can improve.
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4. Demonstrate that you have improved your financial situation

The one significant way to convince the lender for loan approval is showing the improvement in your financial behaviour. Mortgage companies need some reasons to trust on your creditworthiness. They have their risk limits and cannot lend money without rational grounds.

  • Make timely payments - Whatever bills or obligations you have, make their payments on time. Timely instalments send a relief message to your mortgage company that this person is dependable and will make the property repayments on time.

  • Show employment stability proof – The responsibility for the mortgage is as big as its loan amount. It is usually preferred if you have two year employment stability proof to calm down the anxiety of the lender that you can repay the money you borrow. The salary slip, bank statements, your appointment letter of the current company can prove that easily.

  • Present improved debt-to-income ratio - Those with poorer ratio than 60:40 needs to work hard on this aspect. 50% income: 50% expenses OR 40% income: 60% of expenses can only bring rejection. Idol is 70:30, but 60 income and 40 expenses are also bearable. You need to have a satisfactory performance on this part.

5. When to exploit a lease-to-own agreement?

A lease-to-own agreement usually gains its importance when one wants to get a mortgage with a bad credit score. This agreement allows the fund seeker to enter in a mutual consent between a landlord and the tenant (the mortgage borrower).

The fund seeker gets the mortgage for a particular percentage of the property and thus owns only that part. The rest of the part of the property is owned by the landlord only. For example, the mortgage holder gets 70% as a loan of the total property value. That means he will hold this much part of the structure, and for the rest of the 30%, he will give rent to the landlord as he is the owner of that part.

Such agreements usually come into the picture when the sellers are not able to sell their property on the desired price. It is necessary to gain the mutual consent of both parties to enter the agreement.

6. Save a sizeable amount for deposit

Down payment or deposit money is the first and most important chance for you to show the repayment capacity. Bigger the down payment, stronger is the chance of mortgage approval. Save as much as you can.

The minimum limit for a down payment is 5%, but as you have a bad credit situation, it is advisable to keep it at least 10 to 15%. Yes, the factor of good income is also there to create better chances of getting an acceptance from the lender.

However, still saving substantial and considerable amount for a down payment is beneficial because of the two reasons.

  • First, you can cover a more significant part of the property value and have to borrow less, which in turn makes you carry a comparatively smaller burden of obligation.
  • Second, saving a big amount also proves to the mortgage provider that you are getting back to the responsible financial behaviour.

Work on facets of your finances to improve approval chances

You need to pay attention to every aspect that can boost the chances of a ‘YES’ on your loan request. They are-

  • Steady income – As income is playing the pivotal role, you need to first work on its stability. Employment proof is a significant thing to present. Through your appointment letters, bank statements, salary slip, you need to prove that you are in employment since long. One more advice is to stay in the same company for a longer time before you apply for the funds. Idol situation is that you should have worked for at least 2 years.

  • Apply through a joint mortgage - This is a popular way to get a lender’s nod for a bad credit individual only. If you apply for a mortgage jointly with anyone, but the lender will consider a high income of all applicants. If your partner has a good credit score than you, it will raise your chances of being mortgage approved.

  • Bring guarantor with a good or excellent credit score - Stronger is your guarantor on financial part, better are your chances of approval. Not only acceptance becomes easy, but also it is convenient to borrow a larger amount.

  • Bigger deposit – Your deposit amount is your saviour and an enhancement element to the stable income factor. The minimum requirement is 5%, but due to poor credit rating, it is necessary to expand the size of the down payment. Bring it to 10 or 15% and play safer on the property ladder.

  • Recent financial behaviour should be disciplined - Yes, the mortgage providers are always keen to know the financial conduct of the applicant in recent times. Some take last 6 months into considerations while several lenders notice the transactions of last one year. Keep the record clean, pay bills on time.

  • Consolidate if you have scattered debts - Many small loans may not be a significant concern for someone who earns well. But the finance companies do not see it as a positive sign as the debt bearer pays many instalments on different interest rates. It creates the impression that the person has scattered obligations and also a feel of carelessness arises. A better way is to consolidate debts to cover all of them into one large loan and instalment on a fixed rate.

Reasons You May Have a Bad Credit History

If you are not in a rush, you have a chance to improve your credit score but before that, you need to know what exactly takes a toll on your credit rating.

  • Late payments
  • Unidentified borrowing
  • No credit history
  • Too many credit checks
  • Mistakes on your credit report
  • Falling into a serious debt

Ways to get rid of bad credit rating and improve approval chances on mortgage

It is not enough to just know the reasons of the bad credit rating. Sincere efforts for the improvement of credit rating are also important.

Below are some ways that can help you earn an upgrade in the credit rating.

The following ways are practical, workable and easy to implement and give assured and promising results.

Get registered on the electoral roll
Electoral roll is the first place where lenders check your name. It tells about who you are, what is your address and with whom you live. These basic details are important for the lenders. Having your name here show you as a responsible person.

Did you know?

If your bad credit situation is inconsistent you can get more mortgage loans amount and better relaxation in rates.

Do not miss repayments
Whether it is an electricity bill or a credit card due, do not keep the obligations pending. Pay them on time and get an improvement in credit rating. Delayed payments are the prime factor to cause a sharp fall in the credit rating.

Check your credit file on regularly
Credit reference agencies take your information from many sources and there may be some mistake on some aspects. It is necessary to ensure that the finance industry get an actual reflection of your financial behaviour. Credit files are the mirror image of that. In every 2 to 3 months, you should check your credit file as a wrong information can badly affect your credit rating. A wrong address, wrongly spelled name, anything can affect that. Either Check your credit records from free websites or take paid service.

Close unused bank accounts, store cards, credit cards and direct debits
Anything, which is no more in use, should not show in your financial records. A bank account, credit card etc. that is no more in use can degrade your credit rating. Close them NOW. They take huge claim from your affordability. The finance companies see such financial commitments due on your name and assume you less efficient to bear a new obligation.

Salary slip / income status and bank statements are important to prove repayment capacity.

Say good-bye to financial partners
Did you know the credit rating of your financial partner can affect your financial records? Their bad credit rating can affect your credit rating. If you and you partner have split up then make sure that no joint financial commitment exist. Otherwise, this may have a long-term impact on your finances.

The improvement in credit score is sure to leave its good impact. The credit reference agencies mark these changes in your credit record.

First time borrowers with bad credit and good income - Welcome
Despite bad credit and despite a no credit history Shine Mortgages provide funds. The procedures are rational and focus is basically on the financial efficiency of the applicant. No credit rating or borrowing history then can intrude or interrupt.

Financing available in following bad credit conditions for the applicant with a promising income figure

With the liberal approach of the new-age finance industry, it is now possible to get a mortgage despite poor credit in varied situations.

  • Bankruptcy financing (debt up to £5000)
  • County Court Judgement (CCJ) financing (if debt size is maximum £2000)
  • IVA - Individual Voluntary Arrangement (debt up to £8000)

Shine Mortgages can bring mortgage deals in all the above conditions.

Shine Mortgages, like always is destined to provide uncompromised mortgage deals to its customers. We do not leave the borrower until the final agreement of loan takes place between the lender and the fund applicant. Come to us, and we are sure to serve only satisfaction.

How can I improve my bad credit rating?

With the help of some simple yet practical ways, you can turn your bad credit score into a good.

  • Make timely payments
  • Do not max out your credit card
  • Keep a proper balance of credit mix
  • Get on the electoral roll
  • Keep space in your credit application and do not make multiple requests
  • Avoid high-interest debts like payday loans
  • Stay cautious against the threats like identity theft

The above ways relate to your daily financial habits in finances. Discipline in your personal life is the key to all improvements in credit score.

How To Get A Mortgage With Bad Credit But Good Income FAQs

How can I boost my credit score 100 points?

If you are talking about 100 credit points, then you have to work hard to improve it. Since your financial profile does not have the credibility factor, it will take time to increase the score. However, you can regularly follow these activities:

  • Pay all the utility bills on time.
  • Strange but useful is to apply for a short-term loan and make its repayments on time.
  • Take valuable advice from the mortgage broker.

Can I get a home loan with a 500 credit score?

It is not going to be easier for you as compared to those having better credit ratings. But there are a few lenders who are providing a mortgage for bad credit people. Finding them and then applying may not be straightforward, but you can do these things:

  • Go for the expertise of a mortgage broker such as ShineMortgages.
  • Compare the interest rates of varied lenders suggested by the expert.
  • Choose your best deal according to your repayment capacity.
  • Once amount received, repay it on time.

Can I get a mortgage with bad credit but big deposit?

Yes, you can get the mortgage despite a poor credit if you have a significant deposit. However, varied other factors come under consideration.

  • Your big deposit should be as big as 20-25% of the total property value.
  • Your current income status should be stable and good income. A right amount of monthly salary is a necessity.
  • Improve the debt-to-income ratio. It should not be lower than 60:40. The more significant part is income, and the smaller part is debt. Best is to keep 70:30 ratio.

With the above conditions to qualify for the mortgage, you need to find a mortgage broker that can offer you accurate deals like Shine Mortgages. This prevents wastage of time, and also you can take better decisions with multiple options. A poor credit score person is prone to fake deals. A broker is unbiased and tied to no lender; you can have better assistance.

Can I get a mortgage with no credit check?

You can get a mortgage with a soft credit check, which is also known as no credit check. This type of credit score perusal leaves no search footprint on your financial records. Usually, the applicants with a bad credit history or no credit history demand a ‘no check’ on their credit report.

To get a mortgage with no credit check, you need first to find a lender that offers this. It can be a tough task, as there are countless mortgage companies in the market. With the help of a broker, you can find such a mortgage company. Shine Mortgages, the online broker can bring to you a lender that performs no inquiry on the credit report.


Some simple factors can get you approval despite bad credit but good income. They are -

  • Improved recent financial behaviour is necessary. Maybe in the past, you slipped into poor credit situation but at least show the determination to improve finances in the current situation.
  • A significant deposit amount that is around 15% to 20% of the property value is vital. Bigger the deposit amount smoother is the approval.
  • A guarantor with a sound financial background and a good credit score. The person that gives a back-up to your application can be a big saviour in this situation.
  • Get on the electoral roll with the current address. It helps the lenders verify the residential details. Home address is one of the critical factors to know the authenticity of the applicant.
  • Stay in the same job for a long time. A poor credit score person should not change the job at least one year before applying for a mortgage. Some lenders even expect the applicant to have completed at least two years when they apply for the loan.


There can be no lowest credit score to get a mortgage. It is because there are many other factors that come under consideration.

A good credit score person may get funds, but if his current income status is poor, rejection can happen quickly. While on the other hand, a bad credit score applicant can get approval with a functional current income status and a few other factors in his favour. Like a guarantor with good credit rating and monthly income etc. However, it is always advisable to avoid a drop in the credit score by embracing discipline in financial life.