To put that into context, that’s 1.15m people in 2019 (a 3% increase on 2018) who have a CCJ recorded against their name.

Many people with CCJs believe that they will need to be cleared for at least 2 years before they can even think about applying for a mortgage. As part of our recent research into Adverse Credit, 26% of people surveyed thought they would have to wait longer than 5 years to apply for a mortgage after being registered with a CCJ.

When in fact, this is not the case. The good news for your clients who have had a CCJ registered on their credit file is that they can apply for a mortgage as recently as 12 months after a CCJ is registered.

What’s more, in most cases, CCJs are not the most common reason for people to fail the credit score of a lender.

Poor credit and defaults

Analysis of our completions from 2019 show that 58% of customers have experienced adverse credit. With 25% of all completions from 2019 having a CCJ registered on their credit record.

Your clients don’t need to have been taken to court for an outstanding debt in order to fail a credit score, they don’t even need to have had a credit account go into default.

Missing payments on their credit commitments alone could see their mortgage application rejected by a high street lender.

With so many monthly commitments, such as mobile phone bills, broadband, utilities and car payments, people have more opportunities to miss one or more regular payments than ever before.

One missed payment may not necessarily result in a failed credit score, but if it’s combined with other factors that are assessed negatively by a scoring system, such as not having a long enough period in current job, moving house too frequently, or having a thin credit file, then the case could be dismissed.

Don’t let defaults and CCJs get in the way of your client and their mortgage

In our Spring 2020 Adverse Credit Study, we found that 41% of all adults say they have missed more than one credit payment in their lifetime. This means that as many as 4 in 10 of your clients could miss out on a high street mortgage, which is why you should consider a specialist lender first for those cases.

Our underwriters individually assess every application and don’t need to rely on an arbitrary score. Instead, we take a pragmatic view of any missed payments and make an assessment as to whether these are indicative of ongoing financial strain, or just someone who has had some blips in the past.

Failing a lenders credit score is not always the result of significant credit issues.

Sometimes your clients will benefit from a specialist approach if they have just a few recent missed payments. CCJs may be rising, but it’s smaller incidents like missed payments that are driving force behind the growing demand for adverse credit mortgages.

We accept that life has twists and turns, which is why we’re continuing to redefine lending norms, looking for a reason to offer help to your clients, rather than refuse it.

Through our more human approach to underwriting, we read between the lines and see the story behind the numbers.

Pepper Money have a simple and inclusive range of mortgage products to help people in all kinds of situations and look at each case on its own merits, often saying ‘yes’ when others have said ‘no’.

Try our affordability calculators to find out how much your clients could borrow even those who have experienced missed payments or CCJs from as recently as 12 months ago.