Most borrowers can comfortably afford their credit, yet this doesn’t mean you won’t see clients with previous credit issues. In fact, there is more outstanding consumer credit today than at any time since the global crisis.

This naturally has led to an increase in missed payments.

This has led to money being owed, which in turn can even lead to a CCJ being registered, especially in modern times as more organisations use automated systems to register CCJs even for debts less than £100.CCJ Mortgage

A borrower with a CCJ doesn’t always mean they’re in debt

Surprisingly, a rise in CCJs doesn’t necessarily mean however, that there are more borrowers struggling with debt. There could be many reasons why CCJs are issued to borrowers. For example, a borrower may be unaware of an outstanding credit balance if bills, and reminders are sent to an old address. As a result, missed payments could lead the borrower being issued a CCJ.

Then there are those who are or have been struggling financially. Options are available to help rectify debts, for example they could organise a Debt Management Plan (DMP). This is a non-binding agreement between an individual and their creditors to repay debts. Learn more about DMPs in our article DMPs Explained.

With the current levels of outstanding consumer credit, increasing living costs and rate rises on the horizon, you could encounter more clients in a DMP or with CCJs.

At Pepper Money, we believe that borrowers who are willing and able to work towards rectifying their situation should be able to get a mortgage.

CTA: If you have clients who have experienced either CCJs or a DMP and are in the market for a mortgage, why not try our Affordability Calculator to see how much they could borrow…