Credit Score Basics > What is the minimum credit score for a mortgage in the UK?

What is the minimum credit score for a mortgage in the UK?

Wollit Team2 minute read · Updated 2nd July 2024

The minimum credit score needed to buy a house in the UK varies among lenders, but generally, you’ll need to have a credit score at least in the “good” credit score band.

It is also possible to get a mortgage if your score is lower than this, for example in the “Fair” or even “Poor” credit score bands, but it may be more challenging and you might need to give lenders additional documentation to show that you can afford it.

A mortgage taken in these conditions can also be much more expensive because the lender will charge you a higher interest rate to offset the fact that you’re considered riskier by the credit reference agencies.

What is the average credit score for mortgage borrowers across the UK?

Depends who you ask. According to Experian, the average credit score in the UK is 797 (out of 999).

However, according to Finder.com, the average credit score in the UK is 644 on the Equifax scale (out of 1,000).

This doesn’t necessarily mean that one is wrong and the other correct. They simply work with different lenders to come up with this data. The thing that is obvious, though, is that both of these scores are around the “Good” credit score band.

What is a good credit score for a mortgage?

Lenders in the UK usually use credit reports from one or all of the three main credit reference agencies (Experian, Equifax and TransUnion) to figure out an applicant's creditworthiness.

However, each of these agencies uses a different scoring system, which means that each credit agency has a different score range:

Experian has a range between 0-999;
Equifax has a range between 0-1,000;
And TransUnion has a range between 0-710.

This also means that the “Good” credit score band varies between these agencies:

Experian’s “Good” credit score band is between 881-960.
Equifax’s is between 531-670.
And TransUnion’s is between 604-627.

In other words, you don’t technically have one single credit score – you have three (one for each agency), and you should check all three and pay attention to all of them.

Is a fair credit credit score good enough for a mortgage?

A “Fair” credit score is one right under the “Good” band:

721 to 880 on the Experian scale;
439 to 530 on the Equifax scale;
And 566 to 603 if you’re looking at the TransUnion one.

Having a credit score that’s only “fair” can make it more challenging to secure a mortgage, but it is still possible to get one with this credit rating.

While lenders prefer borrowers with good or excellent credit scores, they will also look at factors beyond just your credit history, such as your affordability, job and employment status, deposit amount, and overall financial situation. This means that if your credit score is in the fair band, you may still qualify for a mortgage, especially if you have a steady income and a good payment history.

However, if you’re approved with a fair credit score, you might be offered mortgages with higher interest rates, which could cost you more in the long run.

To give you an idea, a jump from one credit score band to another can mean as much as 1% increase in interest rate. For a typical 30-year mortgage for a property worth £500,000 taken with a 20% deposit, you could be looking at over £90,000 paid on top of what someone with a good credit score would pay.

This is why it’s so important to work on your credit score – it can save you hundreds of thousands of pounds over the life of your mortgage.

Luckily, now there are many apps that can help you do this

One such app is Wollit. Wollit is an app available both on Android and iOS, and it works by reporting a fixed-fee monthly subscription as a loan repayment to all three credit reference agencies. This helps you build your credit history and directly influences your credit score.

On top of this, Wollit can also report your monthly rent payment to Experian. This can add another line in your credit report that shows lenders that you’re reliable and pay your bills on time, helping you make the most of your rent while you prepare to become a homeowner.