How To Get a Mortgage With No Credit History

Having no credit history can make getting a mortgage trickier, but it’s not impossible.

With our knowledge and experience, we’ve helped many people with no credit history secure the mortgage they need. Read on to find out how we could make your dream of owning a home possible, too.

Can you get a mortgage without a credit score?

Yes, it’s possible to get a mortgage with no credit history. However, it’s unlikely any online mortgage lender or high street bank will consider you. They generally reject anyone who hasn’t got a credit file, as you need to prove that you’re good at paying back what you borrow. 

If you haven’t got a credit history - don’t panic! Plenty of specialist mortgage lenders look at applications on a case-by-case basis. It could mean you’ll need a larger deposit and pay slightly higher interest rates. But you’ll have a better chance of success overall if you speak with an experienced mortgage broker first who could help prepare your application and find a mortgage lender who’s more likely to accept you. 

Why is it harder to get a mortgage with no credit history?

Having no credit history means you don’t have enough recent credit activity under your name to make up a credit score. Typically, lenders want to see evidence that you have a proven history of being able to make repayments on time. They do this through a credit check. 

All this may seem a little unfair -  just because you’ve never taken out a loan or credit card doesn’t mean you’ll be unable to keep up with your monthly mortgage repayments. It could simply mean you generally spend within your means and prefer not to borrow, or you’re relatively young, and this is the first time you’ve applied for a mortgage. 

But mortgage lenders have to make sure you’re going to be a reliable borrower, and they do this by checking your credit history. If you don’t have one, it just makes it more difficult for them to make a decision. 

It’s possible to have a history of credit without even realising it. For example, mobile phone contracts and utilities are still considered forms of borrowing and will give you a credit score. It’s a good idea to pull together any evidence you have that can prove you’re good with money and can keep up with mortgage repayments before you apply. 

This evidence will help your mortgage broker build a stronger case with a specialist lender, giving you the best chance of getting approved for a mortgage. Make an enquiry, and one of our Mortgage Experts will talk to you about the options available.

Why might you have no credit history?

Having no credit history is not the same as having bad credit, which usually results from a particular credit issue such as a County Court Judgment (CCJ) or bankruptcy, causing a low credit score. It’s common for first-time buyers to have no credit score because they still live with their parents (so their name won’t be on any household bills). 

As your credit record only covers the last six years, you could have no credit history simply because you haven’t borrowed money or applied for any type of credit, such as an overdraft, credit card or store card, during that time. So, for example, if you’re retired, you may have paid off all your debts a long time ago and haven’t needed any credit since. 

If that’s the case, as long as you still have evidence of any previous credit agreements, you can prove that you’ve previously had a credit score.  

Here’s a list of typical reasons why you might have no credit history:

• You’re not on the UK electoral roll 

• You don’t have a permanent address

• You have no UK employment record

• You don’t have a utility bill in your name

• You’ve recently moved to the UK and have not yet opened a bank account

• You were living abroad for several years and have just returned to the UK

• You’ve been living with your parents

• You’re independently wealthy and haven’t needed credit before

• You’ve recently been released from prison

• Your credit history is outdated (nothing on there for six years or more)

The good news is a number of the reasons above are easy to fix with time and patience. Once you’ve done that, along with some help and guidance from your broker, you’ll be in a good position to apply for a mortgage. 

Can you get a no credit check mortgage? 

No, it’s standard procedure for mortgage lenders to conduct a credit check before offering you a mortgage. How they react to the results will vary. A mainstream lender would likely see an applicant with no credit history as a red flag. But, a specialist lender will judge your application overall. 

This means that they will consider not only your credit record but also your employment history, disposable income, age, and the size of your mortgage deposit before making a decision. 

If you can provide evidence for why you have no credit score but the rest of your application looks strong, you’ll have a better chance of getting a mortgage by applying to a lender who looks beyond computerised checklists and considers applications on a case-by-case basis. 

This is where we can help! Our team of Mortgage Experts will already know where to look and which lenders will consider applicants with no credit history more favourably. If you make an enquiry, we’ll arrange for a member of our team to contact you straight away to get started. 

How to get a mortgage with no credit history

By following these essential steps and building your credit history before applying, you’ll give yourself the best possible chance of getting a mortgage. 

Build your credit score

Building your credit file from scratch is more straightforward than trying to repair a bad one, and you should begin to see positive results more quickly. The actions you can take include: 

• Registering on the electoral roll* at your current address

• Opening a UK bank account

• If you’re currently renting, make sure your name is on the rental agreement and, if possible, the rent payments come from your new bank account

• If employed, ask your employer to pay your wages into your new bank account

• If self-employed, open a bank account for your business and pay your earnings into it

• Make sure your name is on your household utility bills

• Apply for small amounts of credit - a basic credit card, store card and overdraft

• Take out a mobile phone contract in your name

• Make sure all your financial obligations are paid in full and on time

All of the above measures will immediately create a credit profile in your name and make you visible to prospective mortgage lenders when they do a credit search. 

Check your Credit Report

Once you begin to build your credit profile, you can check your credit score by regularly downloading your credit file**. By taking the actions outlined above, you should see your credit score increase over time (typically six to twelve months). 

Your Credit Report will show you every item of credit registered in your name, in addition to your credit score. You can also check that all of the information held (including your personal details—name, address, age, etc.) is accurate and up to date.  

If any of the details need to be corrected, you can contact the Credit Reference Agency directly to have them updated. 

**When you click through to our affiliate links, we may earn a small commission at no extra cost to you. We only recommend sites we trust and believe in. 

Save for a deposit

If you have no credit history to prove to a mortgage lender that you can comfortably meet your mortgage repayments each month, they’ll likely ask for a larger deposit to offset the perceived risk they’re taking. As a minimum, you should expect to be asked for a deposit of between 5%-10%. 

So, it’s a good idea to start saving for a deposit straight away while you build up your credit score. The bigger your deposit, the less money you’ll need to borrow for your mortgage, strengthening your application. 

Speak to an experienced mortgage broker

As tempting as it may be to approach a high-street mortgage lender directly, if you currently have no credit history, this can often result in your application being rejected. This is why seeking the help of an experienced mortgage broker could be a wiser option. 

Specialist mortgage lenders—the ones who will look at your application in much more detail and not just focus on your credit record (or lack of it, in this case)—are typically only accessible through a mortgage broker. 

Your broker can review your situation and offer advice on which specialist lender is best placed to help you, giving you a much greater chance of getting the mortgage you need. 

Do you need a credit card to buy a house?

No, not necessarily. Having a credit card and repaying the bill each month can be an effective way to build your credit score before applying for a mortgage. However, other lines of credit, such as a mobile phone contract or a bank account overdraft, will achieve the same result.  

Mortgage lenders that don’t credit score

Some mortgage lenders use their own internal credit scoring when assessing an application. But others, such as Bluestone Mortgages, Pepper Money, and The Mortgage Lender, don’t. These lenders look at each application as a whole and on its merits before reaching a decision. 

For people with no credit history but who otherwise are a strong applicant, a mortgage lender who chooses not to do their own credit scoring (not the same as the credit score given by a credit Reference Agency) may be the better option.