Mortgage Arrears FAQ
General information only. This is not financial advice.
Last reviewed: 2026-06-06
How long do mortgage arrears stay on my credit file?
Mortgage arrears are recorded on your credit file by your lender and remain visible for six years from the date they were recorded, regardless of whether you have since brought your account up to date. Each missed payment is typically recorded as a 'late payment' or 'missed payment' on your credit file, and the level of arrears (1 month, 2 months, 3+ months) may also be shown. Once the six-year period expires, the record is removed automatically from credit reference agency files (Equifax, Experian, TransUnion). However, mortgage lenders also ask directly on application forms whether you have ever been in arrears on a mortgage or secured loan, and some ask about arrears in the last 10 or 12 years rather than confining their enquiry to the six-year credit file window. Answering these questions honestly is essential.
Can I get a mortgage if I have had arrears in the past?
Yes — having past mortgage arrears does not permanently prevent you from getting a mortgage, but it does affect which lenders will consider your application and the rates available to you. The key factors lenders assess are: how recent the arrears were, how severe they were (number of missed payments and the highest arrears balance), whether they are now fully resolved, and whether there is an explanation. Arrears that are two or more years old and fully resolved are viewed more favourably than recent or ongoing arrears. Mainstream lenders typically decline applications where arrears appear within the last two to three years, while specialist and adverse credit lenders assess each case on its merits, considering the full picture including your current circumstances, income stability, deposit size, and the reason for the previous difficulty.
What levels of arrears do mortgage lenders consider acceptable?
Lender tolerance for arrears varies considerably. A broad spectrum exists: (1) prime lenders (high-street banks and some building societies) typically require a clean credit record with no missed payments in the last two to three years; (2) near-prime lenders may accept up to one or two missed payments in the last 12–24 months if the account is now settled; (3) specialist adverse credit lenders will consider more significant arrears — including three to six months of missed payments — particularly if the arrears were resolved some time ago. The arrears balance matters too: 'up to one month in arrears' is treated very differently from 'six months in arrears'. Some lenders also distinguish between arrears on a residential mortgage (where the security is your home) and arrears on other secured or unsecured credit products, treating mortgage arrears as a more serious indicator of payment behaviour.
Will I pay a higher rate if I have had mortgage arrears?
Almost certainly yes — if you had significant arrears and are applying within the period where they remain on your file or within the lender's declared question window. Adverse credit lenders price their products to reflect the higher risk of lending to applicants with impaired credit histories, and rates are typically 0.5% to 2.5% higher than prime market rates, depending on the severity of the credit issue, the time elapsed, and your deposit size. The good news is that rate positioning generally improves as the arrears become older and your track record of subsequent clean repayment grows. It is common for applicants to take an initial adverse credit mortgage deal, make all repayments on time for two to three years, and then remortgage onto a better rate once the original arrears have dropped below the lender's threshold or off the credit file entirely.
Does having a larger deposit help when applying with mortgage arrears?
Yes — a larger deposit (lower LTV) is one of the strongest mitigating factors in an adverse credit mortgage application, including applications involving previous arrears. At 75% LTV or below, the lender's security position is stronger, which gives specialist lenders more confidence to proceed. Many adverse credit lenders cap their maximum LTV for applicants with mortgage arrears history — for example, accepting up to 85% LTV if arrears were over two years ago, but requiring a minimum 25–30% deposit if arrears were within the last 12 months. If you are purchasing rather than remortgaging, accumulating a larger deposit (even by deferring your purchase by 6–12 months) can meaningfully expand the number of lenders who will consider you and reduce the rate premium you face.
What caused my arrears — does the reason matter to lenders?
The reason for arrears does matter, though it does not override the objective facts on the credit file. Arrears resulting from a specific, identifiable life event — redundancy, illness, relationship breakdown, bereavement — are typically viewed more sympathetically than arrears with no clear explanation or arrears arising from persistent overspending or financial mismanagement. Lenders and brokers refer to this as a 'satisfactory explanation'. A letter from the applicant (sometimes called a credit explanation letter) setting out what caused the arrears, the steps taken to resolve them, and confirmation that the underlying issue has been resolved can support the case for a favourable underwriting decision. This letter is most impactful when the arrears are borderline and the underwriter has discretion to proceed. It carries less weight if the arrears breach the lender's absolute limits (e.g. the lender will not accept any arrears in the last 12 months, regardless of reason).
Can I remortgage if I am currently in arrears?
Remortgaging while currently in arrears is very difficult and largely restricted to specialist adverse lenders. Most lenders require all existing financial commitments to be up to date as a condition of application — an active arrears position on your current mortgage will be visible on your credit file and confirmed by your existing lender in reference checks. If you are in arrears and seeking to remortgage, the most important first step is to contact your current lender to discuss a repayment plan or payment deferral arrangement. Bringing the account up to date (or agreeing a formal arrangement) before applying to a new lender significantly improves your position. If your current lender is unwilling to assist and you face repossession risk, specialist debt advice services can help you understand your options before your situation deteriorates further.
Which lenders specialise in mortgages for applicants with arrears history?
Several specialist adverse credit lenders operate in the UK market and assess applicants with arrears history on a case-by-case basis. These include Pepper Money, Kensington Mortgages, Bluestone Mortgages, Precise Mortgages, and Together Money, among others. Building societies with manual underwriting also sometimes consider applicants with older, resolved arrears. The appropriate lender depends on the severity and recency of your arrears, your deposit size, your current income stability, and whether you have any additional adverse credit (defaults, CCJs, IVA). A whole-of-market specialist mortgage broker who places adverse credit cases is the most effective route to identifying the right lender — direct applications to multiple lenders leave hard footprints on your credit file and can worsen your credit score, whereas a broker will pre-qualify your application against lender criteria before placing it.
Risk warning
Your home may be repossessed if you do not keep up repayments on your mortgage. If you are currently struggling with mortgage payments, contact your lender or a free debt advice service immediately — do not wait.
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