Credit card debt isn’t uncommon
The average credit card debt per household was at £2,534 at the beginning of 2025.
More than 50% of households in the North East, North West, Yorkshire & the Humber, and East Midlands have financial debt.
22% of Londoners find their financial debt to be a heavy burden, notably higher than other regions.
The proportion of individuals with financial debts peaks in the 25-34 age group. 51% of people in this age group have non-property financial debts.
In older age groups the percentage of individuals with these debts falls steadily until it reaches a low of 15% for those 65 and older.
Getting a mortgage with credit card debt explained
Getting a mortgage with credit card debt isn’t as difficult as you might think. Sure, your choice of lenders is going to be much smaller, so you might pay more in interest. The myth that mortgages aren’t open to borrowers with bad credit is exactly that - a myth.
If you’ve been declined for a mortgage because of credit card debt, your next steps to help you work towards your next application are in this guide too.
Do mortgage lenders care about credit card debt?
Yes, any form of debt will be assessed in relation to your income when you apply for a mortgage. Lenders calculate your debt-to-income ratio to help make their decision about whether you can afford the size of the mortgage you’re applying for.
Having credit card debt, more specifically, recent and unpaid credit card debt, can hinder your chances of getting approved which is why you should never apply for a mortgage without first checking if you’re eligible.
A 10-minute chat with a mortgage broker can help you avoid getting rejected for the next mortgage you apply for because they can quickly compare your circumstances with lending criteria.
A bad credit mortgage broker can filter out the lenders that are most likely to reject you because of your credit card debt and instead, highlight those that have criteria that is more suited.
How much credit card debt is too much for a mortgage?
Usually, the more debt you have and the more recently that it occurred, the fewer lenders that will be open to lending to you.
How much credit card debt is too much, is a tricky question because one person might have £1,000 worth of recent ocean finance credit card debt and still get approved because their income is large enough and regular enough to cover mortgage repayments on top of their debt repayments. However, another lender may look at that same applicant’s circumstances and automatically reject them.
Lending criteria is different between mortgage lenders and while that can be annoying for people searching for a mortgage quickly, it does mean that even if you get rejected by one lender, another niche lender could be happy to lend to you.
How is credit card debt calculated for a mortgage?
Your debt-to-income ratio plays a big role in how a lender views your affordability for a mortgage.
Your debt-to-income ratio (DTI) compares how much you owe each month to how much you earn. Specifically, it’s the percentage of your gross monthly income (before taxes) that goes towards payments for loans, credit cards, and other debt.
While your credit report and score give an insight into your historical financial behaviour, your DTI ratio provides an idea about how you’re currently managing your level of debt and therefore, your ability to repay it in the future.
You can calculate your debt-to-income ratio yourself to decide whether applying for credit is the right choice for you.
Calculate your debt-to-income ratio for a mortgage
Add up your monthly payments to debts which may include credit card, loan, car finance, or store cards.
Divide the total by your gross monthly income, which is your income before taxes.
Multiply this amount by 100 to convert it to a recognisable percentage.
The result is your DTI, which will be in the form of a percentage.
So as an example, you might have a monthly credit card repayment plan for £100, a car finance repayment for £100, a hypothetical future mortgage repayment of £600 a month, and a monthly income of £1,700.
(Your total monthly debt) £800 / (Monthly income before tax) £1,700 = 0.47
When multiplied by 100, the DTI ratio based on this example would be 47%.
Lenders typically prefer to see a debt-to-income ratio smaller than 36%, with no more than 28% of that debt going towards servicing your mortgage.
The lower the DTI; the less risky you are to lenders.
There are two ways to lower your debt-to-income ratio:
Reduce your monthly recurring debt
Increase your gross monthly income
Can a first-time buyer get a mortgage with credit card debt?
First-time buyers already face tough affordability checks and scrutiny from lenders keen to alleviate the risk of loss, so having credit card debt isn’t ideal.
A clear pattern of repayment indicates to lenders that you’re responsible and committed to reducing your debt, so try to repay at least the minimum payment and if you can affordably do so, it could be worth clearing the debt.
Always seek advice from a professional financial advisor before clearing credit card debt, to calculate whether the repayments are affordable for you.
A mortgage broker can also help you compare lenders and their rates so you can see how repaying the credit card debt could affect your ability to get a mortgage and whether it could affect the interest you’re charged.
Can a person over 50 get a mortgage with credit card debt?
The average mortgage term is 25 years, so borrowers over 50 can sometimes face scrutiny over how their income will be sufficient enough to cover the repayments of a mortgage during retirement.
As long as you can prove that you have enough stable income to meet the affordability requirements of a mortgage, you should be able to find a lender to approve you.
However, having credit card debt on top of being an ‘older’ applicant can result in a reduced choice of lenders. The risk of you defaulting on a mortgage repayment could be considered greater by the lender if you have credit card debt as well as further affordability issues such as a drop in income once you reach retirement age.
You might be a borrower over 50 in a position to afford a mortgage on top of your credit card balance repayments and if that’s the case, you’ll have a few options to choose from, which might include, RIO mortgages, equity release, or a remortgage.
Check your eligibility for a range of mortgage products before diving into a lengthy agreement because ultimately, the interest you’re charged and the terms and conditions of your mortgage contract, affect how much you pay overall.
I have credit card debt but my partner has none, should we apply for a joint mortgage or a mortgage in just their name?
It’s not uncommon for one borrower to have credit card debt and the other has none. Credit card debt can hinder an application if you’re applying to the wrong lender. Some people make the mistake of avoiding a mortgage altogether because they’ve been rejected in the past or they’re worried that their credit card debt will stop them from getting approved.
However, having two applicants on a mortgage application, even if one has debt, can be a good thing. That’s because if both parties work, there would be two incomes included in the affordability calculations, as opposed to one.
Therefore, the proportion of debt repayment to household income, which is another factor lenders consider, would be lower.
There are lenders in the UK that accept credit card debt, it’s your ability to prove your affordability for the loan size that concerns lenders. While credit card debt isn’t exactly a good indicator that you repay your debt on time and in full, if your circumstances as a whole indicate that you and your partner can afford it, you have a higher chance of getting approved.
Should I clear credit card debt before applying for a mortgage?
That depends on the circumstances surrounding the debt and whether clearing the debt would wipe out your savings.
The interest rate charged on most credit cards is typically much greater than that of savings accounts or mortgage products, so it could be cheaper to repay the debt before acquiring further debt.
That being said, repaying your credit card debt would lower your debt-to-income ratio and could open up your choices of lenders.
It could also be worth considering moving your credit card balance to a 0% credit card, to avoid paying interest and therefore save you money but before you make a decision, always seek the advice of an independent financial advisor. It’s their job to objectively look at your financial situation and help you reduce your outgoings and advise you on how best to navigate your debt repayment plan.
Tips on how to get a mortgage with credit card debt
Check your credit report to see how much collective debt you have, how long ago it was, and whether any mistakes need to be contested with the original creditor.
If you're not using an account, it may be worth closing it. Leaving it open might be a fraud risk, and it could display out-of-date details.
Repay your credit card balance(s) if affordable and manageable to do so, to lower your DTI (debt-to-income ratio)
Register to vote - this helps to confirm you are who you say you are, and live where you say you live and that you're not laundering money.
Save a larger deposit if possible to do so, so you reduce the amount you’re borrowing and have lower mortgage repayments.
Prepare your paperwork. That includes a passport, bank statements for 3-6 months, proof of address, and a copy of your credit report for your broker so that they can get a true reflection of your financial circumstances and work to help you find the best-matched mortgage agreement.
Ask for help about getting a mortgage with credit card debt
Check reviews for mortgage brokers and find out which lenders accept credit card debt.
Mortgage brokers work to find the best mortgages for the people they’re helping. They can work quickly to get you the information you need to make a decision about getting a mortgage with credit card debt and can show you the steps needed to take to buy a home sooner.
Their priority is your peace of mind and a good mortgage broker always keeps affordability at the forefront of their mind to help mitigate against the chance of the agreement becoming too expensive for the borrower.
Credit cards and mortgages: FAQs
Is credit card debt the deciding factor in a mortgage application?No lots of factors affect whether or not you’ll get approved for a mortgage including:
Your annual gross income
How dependable your income is
Your age
The type of property you’re buying
The type of mortgage product you’re applying for
Possibly yes, it depends on your ability to meet a lender’s criteria. Criteria for different mortgage products, with different lenders, varies massively. Some accept debt if it’s been cleared or a payment plan is in place, while for others, it’s an immediate no.
Having both credit card debt and car finance debt can rule out some lenders but certainly not all of them. The interest rate you pay for a mortgage with credit card and car finance debt will likely be higher compared to someone without any debt but again, your circumstances as a whole will contribute to that.
Approaching lenders without first looking at their eligibility criteria can be a quick way to get a mortgage rejection so ask a broker to run a quick check first.
Can I remortgage with credit card debt?Some homeowners decide to remortgage to a better, cheaper deal and in doing so they can reduce their monthly repayments. However, some people may be eligible to borrow more on their remortgage so that they can repay credit card debt.
Your ability to remortgage with credit card debt, whether for a higher or lower mortgage amount than your previous agreement, will be dependant on factors like your age, the amount of equity you own in your property, the amount of credit card debt you have, and your income.
With so many factors that can affect a lender’s decision to approve a remortgage for a borrower with credit card debt, it can be helpful to get advice from an expert who will compare a multitude of deals to find you the most suitable one.
