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Loughborough Building Society described as “bold and pragmatic” as it programs its systems to accept minor credit blips

ended 02. April 2025

Loughborough Building Society has been described as “bold and pragmatic” by brokers following a new lending policy change that goes live today. The lender has said it “will accept applications up to 95% LTV where applicants have unsatisfied Defaults on Mail Orders, Utility Bills, Bank Accounts, Car Insurance and Telecommunications without the need to refer" — and has programmed its systems to accept these cases saying “no explanation is required”. One broker said: “With the cost of living crisis and years of easy credit catching up, minor adverse credit is becoming more common – and lenders are having to adapt. “Adverse” is no longer a niche scenario; it’s fast becoming part of the mainstream mortgage landscape.” Another added: “Loughborough’s move to open up their criteria to account for minor credit blips shows that some lenders are beginning to take a more balanced view on credit issues, which is definitely a step in the right direction.”

8 responses from the Newspage community

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Harry Goodliffe
Director at HTG Mortgages
With the cost of living crisis squeezing household budgets, minor credit blips are becoming more common. Loughborough’s approach is a welcome step towards more flexible, real-world lending. Having a blip on your credit profile in this day and age shouldn't write you off as a bad mortgage borrower.
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Ranald Mitchell
Director at bad credit mortgage specialists Charwin Mortgages
Loughborough’s criteria tweak is bold and pragmatic. While some specialist lenders already take a lenient view on minor defaults for essentials like phone bills or mail orders, removing the need for referral or explanation sets this apart. It reflects a growing acceptance that not all adverse credit is equal. With many borrowers still managing the legacy of easy credit, rising costs and stretched finances, adverse credit is becoming more normal. Lenders that fail to adapt may find themselves out of step with today’s market reality.
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Mike Staton
Director at Staton Mortgages
Since Covid and lockdown, lenders have had to look at new ways to look at slight adverse. We live in a generation where lending is the norm and life is lived on credit. The past five years, with higher interest rates and sky high inflation, have stretched household finances to the limit. Lenders being a bit more lenient on minor adverse is a step in the right direction considering how poorly regulated the telecomms and energy industries are. You only have to sneeze for them to give you a late payment or a default.
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Pete Mugleston
Mortgage Advisor & Managing Director at onlinemortgageadvisor.co.uk
Loughborough BS’s criteria tweak is definitely more flexible than what we typically see, especially at 95% LTV. Most lenders would still want explanations or impose stricter terms for unsatisfied defaults, so this stands out as a more pragmatic, borrower-friendly approach. With the cost of living crisis and years of easy credit catching up, minor adverse credit is becoming more common – and lenders are having to adapt. “Adverse” is no longer a niche scenario; it’s fast becoming part of the mainstream mortgage landscape. Sensible, risk-based lending like this can help more people get back on the ladder without unnecessary barriers.
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Justin Moy
Managing Director at EHF Mortgages
With wafer-thin margins on mortgage products, lenders are looking at more niches, such as the 'Poor Credit' and complex income markets, to improve their return on lending. Smaller building societies such as Loughborough BS and Mansfield BS will never run to the volumes of their High Street compatriots, but with some human underwriting and experience in the adverse market can make a real difference. The odd missed mobile phone bill doesn't make a borrower a bad one, but it's enough to fall fowl of computer credit scoring. The expertise of mortgage brokers who specialise in these markets, with good relationships with smaller lenders, will be worth its weight in gold.
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Emma Jones
Managing Director at Whenthebanksaysno.co.uk
I think it’s going a bit far to suggest that ‘adverse’ is the new normal. That said, there are plenty of cases where clients have been impacted by relatively minor credit blips due to life events, enough to take them out of scope with high street lenders. Loughborough’s move to open up their criteria to account for minor credit blips shows that some lenders are beginning to take a more balanced view on credit issues, which is definitely a step in the right direction. Not everyone has credit issues because they were careless. Sometimes life hits hard.
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Rohit Kohli
Director at The Mortgage Stop
Loughborough’s move is a welcome shift that reflects the reality many borrowers face today. Over the past five years, people have been battered by Covid, rising living costs and a sluggish recovery that never really took off. With the world looking more unstable now than ever—from domestic economic uncertainty to global events—the number of people relying on credit just to get by is only going to rise. Defaults on day-to-day essentials are becoming more common, and lenders need to catch up. Blips happen. Lenders need to stop pretending they don’t.
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Dariusz Karpowicz
Director at Albion Financial Advice
Loughborough's criteria tweak isn't entirely unprecedented, but it certainly pushes the envelope of lending flexibility. What we're witnessing is less a revolution and more an evolution of lending criteria, reflecting the uncomfortable truth that financial hiccups are increasingly commonplace. In a world where household finances have been stretched by inflation, interest rate hikes and the lingering economic hangover from lockdowns, lenders are pragmatically adjusting to a reality where pristine credit histories are becoming rarer. The odd missed mobile phone bill or utility default no longer defines a borrower as high-risk, and smaller building societies with human underwriting capabilities are sensibly leading this shift toward more nuanced credit assessment.