Right to Buy

Posted on 4 May 2018 by Jacqui


We’ve been offered the right to buy our property but have bad credit – will we be able to?


Hi Jacqui,

I regret that I am not aware of any lenders who will consider you for a mortgage on a Right to Buy if you have a bad credit record. If the default you have is large enough and recent enough to put off the High Street lenders and the more specialist lenders who consider people with poor credit registered over 2 years ago do not like Right to Buy purchases.

It will be possible if you have the cash to purchase the property, alternatively you will need a mortgage and will find it difficult with bad credit.

You can, as a suggestion:

  1. Obtain a copy of your credit report to determine what, if any, adverse records are showing. If you use one of the main agencies, such as Experian, Equifax or Call Credit they normally have a free offer available to do this.
  2. Consider asking an accountant to prepare a profit and loss statement showing your income for the last 3 years or makes sure you have copies of your self assessment tax returns and any tax calculation forms (SA302) from the Inland Revenue.
  3. Save at least a 10% deposit based on the reduced purchase price.
  4. Consult an independent mortgage broker about your situation.

Peter

Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

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