What credit score do you need for a mortgage?

There’s a common misconception that you need a minimum credit score to get a mortgage.

However, each lender will view your credit history differently, depending on factors like your age, income and the reference agencies they use, which all have slightly different scoring systems.

Here’s everything you need to know about your credit score and mortgages.

What is a credit score?

Your credit score or rating is essentially a picture of how reliable you are at borrowing money in the eyes of a particular agency or lender.

Your score is improved by positive actions, such as regularly paying off loans on time or using a credit card sensibly.

Meanwhile it’s adversely affected by negative actions like missing payments and going over your agreed credit limit.

So far, so obvious. However, none of us has a ‘universal credit score,’ as each lender interprets our history slightly differently.

Most lenders use similar criteria to assess your credit history, but what one considers a major negative may not be as harshly treated by others (and vice versa).

What is the minimum credit score I need to get a mortgage?

There isn’t a set number that will automatically make you eligible for a mortgage.

This is partly because getting a mortgage depends on much more than your credit score, and partly because agencies and lender may use wildly different scoring systems, so the numbers simply aren’t comparable.

That said, it’s always the case that the higher your credit score, the better your chances are of securing a mortgage offer and getting access to attractive interest rates.

However, if your credit score isn’t considered at least decent, it’s likely you’ll struggle to get a mortgage.

Currently there are three major credit reference agencies (CRAs): Experian, Equifax and TransUnion (previously known as Callcredit).

Each of these uses its own unique credit scoring system. Experian’s system ranges from 0-999, and anything below 721 is considered poor.

TransUnion scores borrowers from 0-710 (for some reason) and also has five ‘rating’ bands (with five being the best and one the worst), and any score less than 566 (which is the bottom of band 3) is considered poor.

Equifax has a scale which runs from 0-700, and anything below 380 is poor. So, you can see how very different the benchmarks are.

If you’re below a particular threshold that is considered ‘good’, you should focus on building your score as much as possible before applying for a mortgage.

What is considered a good credit score?

Each CRA assesses your credit history a bit differently and uses a unique scoring system.

Here’s a rough guide to what the three biggest consider a good credit score:

If you’re looking to access the very best mortgage rates, you could try to bump your credit score up into the ‘excellent’ category:

How can you boost your credit score?

There are one-off actions that can improve your credit score, such as registering yourself on the electoral roll and clearing errors on your credit report.

However, careful, long-term credit use is the most effective way to improve your credit score.

It’s easy to think that never taking out a credit card would show you’re good with money, but it can actually lower your credit score.

That’s because lenders can’t assess your reliability with repayments, since there’s no record of you borrowing.

If you’re looking to improve your credit score, try:

• Spending and paying off a small amount each month on a credit card to show lenders you can responsibly manage your credit.

• Prioritising paying off debt to improve your debt/income balance.

• Make sure you know when payments are coming out and always have enough money in your account to cover them.

• Closing any old credit card accounts you’re no longer using – having too many open will make it look like you’re relying on credit too much.

• Encouraging your partner or spouse to work on their credit score too, particularly if they’re an associated financial partner (e.g. you have a joint bank account).

Learn more: Does switching bank accounts affect your credit score?

How long will it take to improve my credit score?

It’s tricky to say how long it will take for you to see improvements in your credit score.

If you’ve picked up a negative mark, such as a missed payment or a time when you went over your credit limit, it will stay on your report for six years.

Even if you’re taking all the right steps to improve your credit score, delays in reporting from lenders can mean it takes several months to see your score move in the right direction.

For example, it could take weeks for a positive action like registering on the electoral roll to show up on your credit report.

Can I check my credit score for free?

Yes. Sites like UK Credit Ratings let you see your monthly credit report for free.

All you need to do is make an account, and you can track how your actions are helping or hindering your credit score.

Bear in mind that this score isn’t definitive – again, it’s just one agency’s interpretation of your borrowing and repaying behaviours.

Are there any mortgage providers that don’t use a credit score?

There are mortgage providers that will accept customers with a poor credit score and/or negative marks on their credit record.

For example, Buckinghamshire will accept people with poor credit, small county court judgements (CCJs) that are more than six months old and even an individual voluntary arrangement (IVA), as long as it was paid off five or more years ago.

However, it states that this is only for certain products, and there’s no guarantee you’ll be accepted.

If you’re looking for expert advice and to access the best rates, it’s wise to speak to a specialist mortgage broker or provider who deals with customers with bad credit.

They’ll advise you on how to improve your chances of being accepted and find products that suit your circumstances.

How many years of credit do I need to have a good score?

Mortgage lenders will typically look back over the last six years of your credit history.

If you’re young and have only a couple of years of credit history, lenders may be more cautious in lending to you.

However, there’s no set timeframe that will automatically boost your credit score.

A 25-year-old in regular, stable employment who uses their credit card sensibly could have a better credit score than a 50-year-old with lots of debts.

The key thing to remember is that you don’t just need years of credit to improve your score – those years of credit just have to be good.

Bankruptcy, CCJs, IVAs and other bad marks will stay on your file for six years, so it’s highly likely you’ll need to wait for these to be wiped before being accepted for a mortgage.

How can I get my credit file corrected?

If you believe there’s a mistake on your credit file, such as an incorrect missed payment, you’re entitled to take it up with the company that has registered the error.

It can be time consuming and frustrating, but it’s worth doing, as an error on your credit report could unfairly exclude you from getting a mortgage.

How can I reduce my chances of being rejected for a mortgage?

As well as taking the steps above to build a strong credit history, there are other ways to get yourself in the best financial shape for a mortgage:

• Avoid applying for anything that requires a hard credit search (such as a credit card or loan) at least 12 months before applying for a mortgage.

• Try to keep your credit use below 25%. This will show you’re responsibly using things like a credit card or overdraft.

• Keep making credit payments on time. If you’re having problems, contact your lender immediately and discuss other options that could help you avoid a negative mark on your credit record.

Once you’ve built up your credit score to the best level you can achieve, contact a mortgage broker so that they can find you the best available mortgage deal and interest rates.

You can also use our mortgage calculator to work out how much money you might be able to borrow and what your monthly repayments would be.

Get expert financial advice

Once you’ve taken steps to build up your credit score and improve your overall financial position, you’ll be in a much stronger place to apply for a mortgage.

Remember that while your credit history is important, it’s only one part of the bigger picture.

Lenders also look at your income, employment stability, deposit size, and wider affordability.

Getting expert financial advice can make all the difference, especially if you have concerns about your credit file or unique circumstances.

A qualified adviser or broker can help you understand your options, improve your chances of acceptance, and secure the best possible deal for your situation.

Let Unbiased connect you with an expert financial adviser who can help you make the best decisions for your financial future.