First-Time Buyer Mortgage 95% LTV Approved With Bad Credit
A case study showing how first-time buyers secured a 95% LTV mortgage with multiple historic defaults and a small deposit.
- Publication date
- Case ID:
- 176025055
Question:
"Can we buy our first home with a small deposit and past credit problems?"
Customer situation
Joint applicants
First-time buyers
Both permanently employed
Two salaried incomes
5% deposit, gifted
Several defaults across credit cards and a communications account, totalling around £7,600, all registered over 18 months ago. Some were satisfied; others remained outstanding
Why This Wasn't Straightforward
A 95% loan-to-value requirement combined with multiple historic defaults ruled out most mainstream lenders. Many lenders apply stricter credit thresholds at higher LTVs, often declining applications based on the number of defaults alone rather than their age, value, or current conduct.
The Outcome
Mortgage approved.
A specialist lender focused on affordability, stability, and the age of the credit issues rather than the number of defaults alone.
Key points
- Loan-to-value
- 95%
- Mortgage term
- 30.5 years
- Lender type
- Specialist lender with criteria allowing high LTV lending alongside historic adverse credit
- Mortgage Adviser
- Lewis Mills
Who This May
Be Relevant For
First-time buyers seeking a mortgage with multiple historic defaults
Applicants whose bad credit limits options at higher loan-to-value levels
Buyers declined because lenders focus on the number of defaults rather than context
Applicants told a clean credit file is required to buy with a small deposit
Plain-English Summary
This case shows that even with past credit problems and a high loan-to-value mortgage, buying a home may still be possible where the wider circumstances are strong.