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How credit cards can affect your mortgage application


Your credit cards, and how you use them, could be the difference between getting on the property ladder or being refused a mortgage.

Man holding credit card

We take a look at how your credit history could affect your mortgage application.

What is credit history? 

Every time you make a credit card, loan or mortgage payment, information about these repayments is stored as part of your credit history.

A credit history indicates to interested parties (e.g. mortgage, loan and credit card companies) just how fiscally responsible and reliable you are, and gives them some of the information they need in deciding whether to offer you a loan or credit.

How does this affect my mortgage application? 

When you apply for a mortgage, the lender looks at your credit report, as well as the salary and personal details you provide, and works out how much of a risk it is to lend you the money to purchase a home.

If the credit report and personal details indicate that you are a "good risk", then you will be offered a mortgage.

Who holds the information?

Three credit reference agencies in the UK hold data on most adults: ExperianEquifax Plc and Call Credit Plc.

This includes credit history, address details and whether you have any black marks against your name like County Court Judgements (CCJs) or bankruptcies.

How to get a good credit score 

For a solid credit rating, always pay off debts on time and with at least the minimum payment. One way to improve your credit rating is to pay off credit card debts in full every month.

This will increase your chances of getting the mortgage you want. If you’re constantly late with payments, getting a mortgage could be more of a challenge.

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If you don’t have a credit card, and you’ve never taken out a loan, you won’t have a credit history.

This could count against you, as the lender won’t be able to predict your behaviour and may reject a mortgage application. 

Therefore, in this instance it’s actually a good idea to consider building up a good credit history.

Using a credit building card may be one option. These credit cards are designed for people with a limited credit history in order to help them build up their credit rating.

Here are five more ways in which you could improve your score.

Five tips to improve your credit score

  • More mortgage options will be available to you if you can show a history of reliably paying off debts on time.  

  • Never miss a repayment. Always pay your credit card bill on time, and pay it off in full each month if possible. If you’ve made late payments in the past, set up a direct debit so you don’t miss them again.

  • When lenders work out your credit score, they take into account the amount you owe. So, if you have savings, use them to pay off any outstanding debts.

  • Don’t apply for lots of credit cards or loans. Each time you apply for a financial product, a search will be recorded on your credit record (the so-called credit footprint). If you have lots of credit on the go, lenders could foresee potential repayment problems. Therefore, cancel any cards or accounts you don’t use.

  • Don’t lie about your credit history in the mortgage application – it’s a criminal offence and could seriously affect your creditworthiness.


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