Reviewed 16th December 2022
Please note – we cannot provide mortgage advice.
Sequestration is a serious form of insolvency action, equivalent to bankruptcy in the UK, which can affect your chances of getting a mortgage. Once placed into sequestration, your assets and equity will be transferred to the ownership of a trustee who will manage the sale in order to release cash and repay creditors.
After sequestration, you will receive a discharge notice which will officially mark the end of your bankruptcy. This is typically 12 months after the date of sequestration, on the anniversary that you entered into it. As a result, your chances of getting a mortgage will be limited. This will typically be based on your spending record and the timescale from when you entered into sequestration.
Many lenders will refuse a mortgage application if you have entered sequestration. The register of insolvencies will record all live cases of sequestration which typically run for 12 months if all terms are adhered to. The register of insolvencies is the Scottish register which records insolvencies of individuals and businesses. Sequestration will also be visible on your credit record for future lenders and banking providers. Following a period of six years; it will no longer be visible.
Time will heal your chances of getting a mortgage as the more time bided from the discharge of your sequestration, the smaller the risk for the mortgage provider. This is dependent on your spending behaviour and whether it illustrates a responsible and trustworthy spending record.
Credit Card - A credit card is a common way to build up your credit record and depict to your mortgage lender that your spending behaviour has improved. By making small value purchases through your credit card and making the repayment within the month, you will be able to show that you are a responsible borrower and have no outstanding liabilities.
Electoral Register - Ensuring that you have a record on the electoral register will instantly improve your credit score. This is used to confirm your identity and the stability of your lifestyle based on your fixed address and how often you move residences. This check is typically performed when taking out mobile contracts, credit cards and other purchases which require an ongoing financial commitment.
Credit Record - Frequently checking your credit record can help track credit arrangements including overdraft facilities and credit cards. It will record if repayments are made on time or late, including defaults. Your credit report will also record whether you are registered on the electoral register.
Amongst brokers and high street mortgage providers, it is worth noting that there are lenders who specialise in providing mortgages to those discharged from sequestration. Mortgages of this sort are typically easier to secure but there may be restrictions in place, such as high interest rates. The fees may be higher than expected and you may have limited access.
Securing a mortgage after sequestration can be a difficult and testing process; however, there are options available for discharged bankrupt individuals. Keeping a steady track of your credit record can help pinpoint your pressure points and how you can improve this. There are credit check agencies who can offer regular credit reports such as Equifax, Experian, and ClearScore.
If you would like more information on getting a mortgage after sequestration and how this can affect your options available, Scotland Debt Solutions can help. We can provide professional advice on how to ensure you have the best chance to qualify for a mortgage. Call the Scotland Debt Solution team for a same-day consultation at any of our four offices in Scotland, or a location of your choice.
Debt Report
Our debt report is completely easy to use and is a great starting point for anyone with over £5000 of debts looking to take control of their debt issues. By providing us with details of your incomings and outgoings we can suggest the most appropriate way forward for you.
Levels of unsecured debt in Scotland increased dramatically during 2022 as the cost of living crisis took its toll on household finances.
Close to half a million Scots are in a position of profound financial hardship, according to a new set of figures.
Disabled people in Scotland are being urged by the government to check whether they might be eligible for benefits that could help make their life a little easier.
FAQ
Services
Our Other Services
Whether you are a sole trader or a limited company director, we can help you work through your current financial problems including money owed to HMRC
Business DebtsA Debt Arrangement Scheme (DAS) lets you pay off your debt through a series of manageable instalments over a reasonable length of time.
Find out MoreA Trust Deed involves making a monthly contribution to your debts for up to four years. After this time any remaining debt included in the Trust Deed will not need to be paid.
Find out MoreWe'll give you a call
Our Scottish based team can help advise you on your debt problems.
Tools
Useful Tools
Our personalised debt report will help you better understand your financial position and see where your money is going.
Arrange a call with an expert advisor at a time to suit you or contact our team via WhatsApp for immediate help and advice.
We have five offices located across Scotland. Find your nearest one here.
More on Sequestration
We can help you with...
Chris had his own business. Everything went fine for a while, but the recession hit hard.
Find Out MoreSequestration is the Scottish version of bankruptcy and may be suitable for you if you do not have the money to pay back your debts
Find out MoreOur Insolvency Practitioners are regulated by ICAS or the IPA and our firm is authorised and regulated by the Financial Conduct Authority
Fees and Information: There are fees associated with our services. These will be fully explained before entering into any of the personal debt solutions referred to on this website. Full details of our fees and how these are charged are fully explained to you prior to you committing to any particular service.