Last reviewed: June 2026
TL;DR- Bankruptcy in England and Wales typically lasts one year - after discharge, restrictions on applying for credit are lifted but the record remains on the credit file for six years from the bankruptcy order date.
- Most specialist adverse credit lenders require the borrower to be discharged from bankruptcy - applying while an undischarged bankrupt is not possible.
- Some specialist lenders consider applications from discharged bankrupts, with larger deposits (typically 25-35%) and higher rates.
- The longer the time elapsed since discharge, the more lender options open up and the lower the rate premium.
How Bankruptcy Works in England and Wales
Bankruptcy in England and Wales is governed by the Insolvency Act 1986. An individual can be made bankrupt by a creditor or can petition for their own bankruptcy. The bankruptcy order is made by the court and the individual's assets (with certain exceptions including tools of trade and basic household goods) are administered by a trustee in bankruptcy. Most individuals are automatically discharged from bankruptcy after one year from the order date, at which point legal restrictions on credit are lifted.
The bankruptcy order is recorded on the Individual Insolvency Register (maintained by the Insolvency Service) and on the individual's credit file with credit reference agencies. The credit file record remains for six years from the date of the bankruptcy order, not from the date of discharge.
Applying for a Mortgage After Bankruptcy
While an individual is an undischarged bankrupt (during the bankruptcy period, typically one year), they cannot legally obtain credit of £500 or more without disclosing their bankruptcy status and cannot be a director of a company. After discharge, these legal restrictions are lifted and the individual can apply for credit, including mortgages.
Most mainstream lenders will not consider mortgage applications from individuals with a bankruptcy on their credit file - meaning no mainstream mortgage is likely until six years after the bankruptcy order date, when the record drops off the file. Specialist adverse credit lenders fill this gap, considering applications from discharged bankrupts before the six-year period expires.
What Specialist Lenders Look For
Specialist lenders assessing a post-bankruptcy mortgage application typically consider:
- Date of discharge: the lender must confirm the bankruptcy has been discharged.
- Time since discharge: more time elapsed typically means more lender choice and lower rates.
- Reason for bankruptcy: a bankruptcy arising from a one-off event (business failure, illness, relationship breakdown) may be viewed differently from one arising from persistent financial mismanagement.
- Rebuilt credit: evidence of responsible credit use since discharge - for example, a credit card or loan managed without missed payments - demonstrates financial recovery.
- Employment stability and income: a stable employment history since discharge is important.
- Deposit: larger deposits (25-35% or more) are typically required.
Timeframes and Lender Tiers
Lender availability broadly improves with time since discharge:
- 0-12 months after discharge: very limited specialist lender options, high rates, large deposit required.
- 1-3 years after discharge: more specialist lenders available, but still adverse credit pricing.
- 3-6 years after discharge: further lender options open, rates improve, deposit requirements may reduce.
- 6+ years after discharge (once credit file is clear): mainstream lenders become accessible, subject to the rest of the credit profile being clean.
Frequently Asked Questions
How long after bankruptcy can I apply for a mortgage?
Technically, a mortgage application can be made as soon as the bankruptcy is discharged (typically one year after the order). In practice, most lenders - even specialist adverse credit lenders - prefer to see some time elapsed since discharge and evidence of rebuilt credit. The earliest realistic timeline for a mortgage application for most discharged bankrupts is typically 12-24 months post-discharge, and with a large deposit.
Will I need to declare my bankruptcy when applying for a mortgage?
Yes. Mortgage applications require disclosure of adverse credit history, including bankruptcy. Failing to disclose is mortgage fraud. The bankruptcy will appear on the credit file search conducted by the lender in any case. Full and honest disclosure is required.
Does bankruptcy affect my partner's ability to get a mortgage?
If the bankruptcy is solely in the applicant's name and the partner was not bankrupt, the partner's individual credit profile should not be affected by the bankruptcy. However, if a joint mortgage application is made, both applicants' credit histories are assessed. The bankrupt partner's history will affect the joint application. Some couples apply for a mortgage in the non-bankrupt partner's sole name, subject to affordability on a sole income basis.
Can I keep my home if I go bankrupt?
Whether a bankrupt individual can keep their home depends on the equity position. The trustee in bankruptcy can claim the equity in the property as an asset of the bankruptcy estate. If there is significant equity, the property may be sold. If there is no equity, the trustee may do nothing with the property but a charge may be registered against it. The Insolvency Service publishes guidance on what happens to property in bankruptcy.
