Is your buy now, pay later habit denting your mortgage chances?

Is Your Buy Now, Pay Later Habit Hurting Your Mortgage Chances?

Financial brokers have warned that regular use of Buy Now, Pay Later (BNPL) services may reduce a borrower's chances of getting a mortgage approval.

How BNPL Use Affects Mortgage Applications

According to brokers surveyed by the Money blog, even borrowers described as having a “perfect credit score” but with a few BNPL transactions have been declined mortgages by major lenders.

“A client’s frequent use of BNPL services can influence a lender’s decision to reject their mortgage application,” brokers noted.

Calls for Fairer Lending Criteria

Brokers are urging mortgage providers to reconsider how they assess customers whose credit files include BNPL payments. They believe these short-term financing options are being unfairly weighted against applicants.

BNPL Companies Respond

In response to the findings, two leading BNPL providers defended their business model, arguing that they offer modern payment solutions and that traditional lenders should adapt to evolving consumer behaviors and technology.

BNPL Explained

Buy Now, Pay Later schemes allow consumers to split the cost of purchases into smaller, interest-free payments. The Financial Conduct Authority estimates that nearly 11 million people in the UK use these services.

Author’s summary: Frequent BNPL use may lower mortgage approval odds, though providers claim lenders must adjust to modern payment systems.

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Sky News Sky News — 2025-11-04

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