How long should I wait after a payday loan to apply for a mortgage?

Ideally wait at least 12 months after your last payday loan. Many mainstream lenders automatically decline applications with payday loan activity within the past 12 months. After 3+ years, the impact is significantly reduced.

Do payday loans show on my credit file?

Yes, payday loans are recorded on your credit file and remain visible for 6 years. Lenders can see when you took them out, the amounts, and whether payments were made on time or missed.

Will one payday loan affect my mortgage application?

It depends on when it was and if it was repaid on time. A single payday loan from 3+ years ago, repaid on time, has minimal impact. A recent payday loan or one with missed payments will significantly limit options.

Can specialist lenders help with payday loan history?

Yes, specialist lenders are more understanding of past payday loan use, especially if there were extenuating circumstances. They assess your current financial stability rather than automatically declining based on payday loan history.

Quick Answer

Can I Get a Mortgage If I've Had Payday Loans?

Last reviewed: December 2025

Reviewed by Jay Sabine – CeMAP Qualified – 29 years experience

Yes, but payday loans on your credit history can affect your mortgage options.

Having used payday loans doesn't automatically disqualify you from getting a mortgage, but it does make lenders more cautious. Many high street lenders have policies against applicants with recent payday loan usage, viewing it as a sign of financial stress. However, specialist lenders understand that payday loans were sometimes used by people with irregular income or as a one-off solution. The key factors are how recently you used payday loans, whether they were repaid on time, and your current financial stability.

Your home may be repossessed if you do not keep up repayments on your mortgage. Your Home Finance Ltd is authorised and regulated by the Financial Conduct Authority (FCA 989177).

Key Points

1Most high street lenders decline applicants with payday loans in the last 12 months
2Payday loans more than 3 years ago have significantly less impact
3Specialist lenders are more understanding of past payday loan use
4Repaying payday loans on time is better than late or missed payments
5The number of payday loans matters - one is viewed differently to many
6Some lenders may require a larger deposit if you have payday loan history

Eligibility Criteria

No payday loans in the last 6-12 months (varies by lender)
All previous payday loans fully repaid
Minimum 10-15% deposit (may need more with recent history)
Stable income and employment for at least 6 months
No defaults on the payday loans themselves

Typical Timeframe

Payday loans stay on your credit file for 6 years. Most mainstream lenders prefer no payday loan activity in the last 12-24 months. After 3+ years with no payday loans, your options significantly improve.

Next Steps

1Check your credit report to see when payday loans were registered
2Wait if possible until 12+ months have passed since your last payday loan
3Build a savings buffer to show improved financial stability
4Speak to a specialist mortgage broker experienced with adverse credit
5Be upfront about your payday loan history - brokers can match you to appropriate lenders

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Can I Get a Mortgage If I've Had Payday Loans?

Key Points

Eligibility Criteria

Typical Timeframe

Next Steps

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