Can I get a mortgage with debt? | WIS Mortgages
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Can I get a mortgage with debt?

We often get asked, "can I get a mortgage with debt?" The answer is, maybe! The kind of debt you have, how much you owe, and how long you've had it all factor into whether or not your debt will hurt your loan eligibility. In this article, we'll discuss the factors that can make or break your chances of getting a mortgage when you have debt. We’ll also be sharing tips on how you can boost your chances of getting a mortgage with debt.

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Can I get a mortgage with debt?

To answer the question "can I get a mortgage with debt?" we'll need to look at some of the most common types of debt and see how they might impact your eligibility for a loan.

Student loans

Student loans are a different kind of debt than credit cards or medical debt. Although they do factor into your primary debt-to-income ratio, lenders have historically had a positive attitude toward student loan borrowers. They see you as an investment in yourself, which goes a long way in their eyes. However, if you're still paying off those loans while trying to get a mortgage, the payments will factor into your total monthly payment obligations. That may reduce the amount of loan you can borrow.

Credit card debt

Like student loans, credit card debt will only become an issue if it has pushed your debt-to-income ratio beyond what the lender is willing to accept. Often, lenders want to know that you're managing your credit card accounts responsibly by using less than 30% of your available credit limit. If you have a lot of credit card debt, you may find it harder to get approved for the maximum loan size you'd like.

Medical bills

These can vary widely in how much they impact your credit score and your ability to get a loan. It probably won't be an issue if you have medical bills on your credit score but have an otherwise clean record with no late payments or other blemishes. If your medical bill is reasonably large and has gone into collections, however, that could be more problematic, especially if there are other negative items on your credit score.

Car finance

If you have a car loan or other personal loan that requires regular monthly repayments, lenders will look at whether or not you've been making these payments consistently. They'll also look at whether or not the loan is secured against an asset. A secured loan indicates a lower risk for lenders, so this won't necessarily be as much of an issue as an unsecured personal loan might be.

Mobile phone contracts

These usually won't affect your eligibility unless something else on your credit history makes lenders worried about giving another line of credit. Try to pay these bills on time so that there isn't anything negative reported to Equifax or Experian by defaulting or missing payments.

CCJs and IVAs

If you have a County Court Judgement (CCJ) or an Individual Voluntary Arrangement (IVA), it could lead to mortgage lenders rejecting your application. Both CCJs and IVAs indicate that you have financial problems and are struggling to repay debts. These issues will only be resolved if you pay off the balance owing on your accounts. If you haven't already, speak to a qualified financial advisor about what steps to take next.

Payday loans

Payday loans are infamous for high-interest rates and predatory practices. For this reason, these debts can be particularly problematic because they're usually difficult to repay in a timely fashion. As such, they can drag down your credit scores. If you're still struggling with payday loans and haven't been able to bring them under control, lenders will be less likely to want to work with you on a mortgage loan.


If you filed for bankruptcy in the past seven years, it could impact your ability to qualify for a mortgage. However, if you can show that extenuating circumstances led to your bankruptcy (job loss, severe illness), lenders may be more willing to look at your application. Additionally, if you can show that you've made significant progress in managing your finances since then, this will go very far towards getting lenders to approve your loan.

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How can I improve my chances of getting a mortgage with debt?

If you're saddled with debt and trying to get a mortgage, don't panic. Here are some things you can do to set yourself up for success.

Talk to a mortgage adviser

Getting a mortgage with debt can be possible if you understand the process of getting one. A mortgage adviser can help you figure out which steps you should take and your chances of getting a mortgage based on your debt levels and other factors. You can find mortgage advisors who charge zero fees.

Improve your credit score

To get approved for a mortgage, you'll need to have an excellent credit score. You can check yours online, and if it's not great, there are ways to improve it. The first thing you should do is make sure all the information on your report is accurate. If there are any errors, you can dispute them with the credit reporting agency. Then you can work on paying down your debts and making payments on time.

Get a guarantor mortgage

If you have a close friend or family member who trusts you and has good credit, they may be able to help by co-signing your mortgage or acting as guarantor for the loan. If you default on payments they'll be responsible, so don't do this unless you're sure the person understands what they're getting into!

Save the maximum deposit possible

You'll need to put down at least 5% of your home's value as a deposit, but if you can afford to put more down, your mortgage will be less risky for the lender and, therefore, more likely to get approved.

Consolidate debt into one payment

If you have multiple loans or debts, see if it's possible to consolidate them into one payment per month. This will make it easier for you to quickly pay off all of your debt. Also, it will simplify things for the lender, making it more likely that you'll be approved for a mortgage.

How Wis Mortgages can help you

Wis Mortgages is a digital mortgage broker that provides one-stop-shop services to clients, including specialist advice for contractors. We cover the whole of the UK, including Kent, London, Essex, and Buckinghamshire. The WIS Group also consists of several divisions offering various complementary services, including accountancy (not regulated by the Financial Conduct Authority), business protection and pensions.

Don't hesitate to contact us today. We offer free advice and an online mortgage calculator to help you determine your budget for a home.

“As a mortgage is secured against your home/property it may be repossessed if you do not keep up with the mortgage repayments.”

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