Put the same case details into each column, use current personalised illustrations and compare the cost over the same period. The lowest rate or monthly payment does not tell you what the mortgage will cost, what balance will remain or how easily you can leave the deal.
How do I compare bad credit mortgage offers?
Compare current personalised documents, not representative examples. First confirm that the loan amount, property value, term and repayment method match. Then record the initial payment, fees, incentives, follow-on rate, APRC, early repayment charges, flexibility, total paid during your planned period and the balance left at its end.
Start with the same comparison case
Two illustrations are not comparable if the underlying borrowing request is different. Write these details once above both columns.
Know which mortgage document you are comparing
An agreement in principle, a personalised illustration and a formal mortgage offer answer different questions.
Agreement in principle
An agreement or decision in principle is an early indication based on information and checks completed at that stage. It is not a promise to lend and the amount, product and conditions can change.
Personalised illustration
The illustration sets out standardised information for a particular mortgage, including payments, costs, rate features and risks. Use it as the source for the worksheet, while checking that the case details are current.
Formal mortgage offer
A lender normally issues an offer after its underwriting and property checks. Read the conditions, expiry date and any reflection-period information, then confirm that the figures still match the recommendation.
Bad credit mortgage offer comparison worksheet
Use a separate copy for each pair of current illustrations. Replace “copy from document” with the exact figure, wording or condition.
| Comparison item | Offer A | Offer B | Why it matters |
|---|---|---|---|
| Document and stage | Illustration or formal offerCopy date and version | Illustration or formal offerCopy date and version | Do not treat an early indication as a final offer. |
| Loan, value and LTV | Copy all three figures | Copy all three figures | Different assumptions can change price and eligibility. |
| Repayment method and term | Copy from document | Copy from document | These affect the payment and remaining balance. |
| Initial rate and type | Rate, fixed/variable type and end date | Rate, fixed/variable type and end date | Record how long the starting rate applies. |
| Initial monthly payment | Copy amount and start date | Copy amount and start date | Check that both use the same loan and term. |
| Payment change examples | Copy relevant illustration figures | Copy relevant illustration figures | Shows the effect described if the rate changes. |
| Product and advice fees | Amount, payee and payment stage | Amount, payee and payment stage | Separate lender and broker charges. |
| Valuation and legal costs | Charge, allowance or included service | Charge, allowance or included service | Check the scope and exclusions, not just the label. |
| Fee added to the loan | Amount added and new balance | Amount added and new balance | An added fee usually attracts mortgage interest. |
| Cashback or incentive | Value, timing and conditions | Value, timing and conditions | A benefit can be conditional or paid after completion. |
| Follow-on rate | Name, current rate and basis | Name, current rate and basis | The payment may change after the initial period. |
| APRC | Copy from document | Copy from document | A broader annual cost measure using stated assumptions. |
| Overpayments and flexibility | Allowance, limits and conditions | Allowance, limits and conditions | Useful only if the feature fits your likely behaviour. |
| Early repayment charge | Period and calculation | Period and calculation | Could matter if you sell, repay or switch early. |
| Portability | Conditions, reassessment and fees | Conditions, reassessment and fees | Portable does not mean a future move is guaranteed. |
| Total paid in planned period | Comparable adviser/lender figure | Comparable adviser/lender figure | Use the same dates and clearly defined inclusions. |
| Balance after planned period | Copy comparable balance | Copy comparable balance | A lower payment can leave more to repay. |
| Offer conditions and expiry | List unresolved conditions and date | List unresolved conditions and date | Timing and conditions can affect whether completion is practical. |
Compare APRC and your likely holding period
These views answer related but different questions. Keeping them side by side avoids a decision based on one attractive number.
What APRC helps you see
APRC combines interest and relevant charges into an annual percentage using the assumptions in the mortgage documents. It supports a broader comparison, including what happens after an initial rate, but assumes the mortgage runs for its full term.
What a same-period comparison adds
If you expect to review the mortgage after an initial deal, compare the cash paid and the balance left over that exact period. Include agreed costs and incentives once, state what the total covers and test the effect of leaving earlier.
Test flexibility, exit costs and incentives
A feature has value only when its rules match what you may do during the deal.
Overpayments
Record the allowance, calculation period, minimum amount and charge for exceeding it. Do not assume a stated allowance works the same way on every product.
Early repayment
Copy the charge period and method. Consider a sale, remortgage, lump-sum repayment or relationship change that could bring the charge into play.
Porting
Check the procedure, reassessment, property criteria, extra borrowing rules and fees. Portability is a feature subject to future checks, not automatic approval.
Payment features
Underpayments or payment breaks may have qualifying conditions and can increase the debt or term. Record the rules rather than treating flexibility as free.
Cashback
Record who pays it, when, and whether completion or another condition is required. Compare its value once within the same period.
Included services
For a valuation or legal service described as free, check who appoints the provider, what work is covered and which extra costs remain yours.
Add the checks that fit your mortgage route
The core worksheet stays the same. These route-specific questions help reveal a cost or condition that could otherwise be missed.
First-time buyer
Check the cash needed for deposit, fees, survey, legal work and the move. Keep an emergency margin rather than committing every available pound.
Home mover
Compare sale and purchase timing, any charge for repaying the current loan, porting conditions and what happens if the sale or purchase changes.
Remortgage customer
Use a current redemption statement. Add the existing lender’s early repayment or exit cost and compare included legal work, valuation and cashback scope.
Self-employed applicant
Confirm that both assessments use the same income evidence, trading structure and period. A lower headline rate is irrelevant if the case does not meet the criteria used.
Five checks before you select an offer
These checks turn the worksheet into a decision record you can revisit.
How this comparison guide was checked
The method uses official consumer guidance and mortgage disclosure rules. It does not publish lender criteria, representative deals or invented cost ranges.
MoneyHelper mortgage advice
The government-backed service explains why borrowers should compare fees and features as well as rates, and lists the information a mortgage illustration provides. Read the mortgage advice guide (opens in a new tab).
MoneyHelper interest rates
Its rate-options guide explains APRC, fees, exit penalties and mortgage features, including the trade-off between a lower rate and a fee. Read the rate-options guide (opens in a new tab).
FCA mortgage information
The FCA handbook sets out standard information for mortgage illustrations and, where applicable, offer and reflection-period requirements. Read MCOB 5A Annex 2 (opens in a new tab) and MCOB 6A (opens in a new tab).
Ask Count Ready to explain two mortgage illustrations
Tell us whether you are buying, moving or remortgaging, the broad credit issue, the borrowing required and whether you already hold current illustrations or offers. Before any work that carries a fee begins, we will explain its cost and the next stage.
For your first contact, describe the situation without attaching account numbers, online-banking details or your full credit report. An adviser can agree a secure route for documents that are needed later.
Comparing bad credit mortgage offers
What should I compare between two bad credit mortgage offers?
Compare the same loan amount, property value, repayment method and term. Then check the initial rate and payment, every fee and incentive, the follow-on rate, APRC, early repayment charges, flexibility, conditions, cost over the period you expect to keep the deal and the balance left at the end of that period.
Is the mortgage with the lowest interest rate always the cheapest?
No. A lower rate can come with a product fee, advice fee, valuation cost or other conditions. A deal with a higher rate and lower fees can cost less over a short period. Compare personalised illustrations using the same assumptions rather than choosing from the rate alone.
Should I compare APRC or the cost during the initial deal?
Use both for different purposes. APRC combines interest and relevant charges into an annual percentage based on stated assumptions, including keeping the mortgage for the full term. A same-period comparison shows the payments, costs and balance during the years you realistically expect to keep the deal. Neither figure should be read in isolation.
Is an agreement in principle the same as a mortgage offer?
No. An agreement or decision in principle is an early indication based on limited information and is not a mortgage offer. A personalised illustration explains a product using standard information. A formal offer normally follows underwriting and property checks and may contain conditions, an expiry date and a reflection period.
Should I add a mortgage product fee to the loan?
Only after comparing both choices. Adding an allowed fee can reduce the cash needed at the start, but it increases the balance and usually means paying interest on that amount. Ask for the payment, total cost and remaining balance with the fee paid upfront and with it added.
Do cashback or free legal services make one mortgage better?
They can reduce a specific cost, but the value depends on the conditions and the service included. Compare the incentive with the rate, fees, legal scope, timescale and any restrictions. Cashback should not hide a higher overall cost or an unsuitable feature.
Which bad credit mortgage offer is best for me?
The suitable choice depends on affordability, the credit history disclosed, how long you expect to keep the mortgage, your need for flexibility and the risks you can accept. A broker can explain the differences, but a mortgage is not guaranteed until a lender completes its checks and issues an offer.
Continue your bad credit mortgage research
General information only, not personal financial advice. Count Ready is a broker, not a lender. A discussion, agreement in principle, illustration or application does not guarantee a mortgage offer. Your home may be repossessed if you do not keep up repayments on your mortgage.