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

Using buy now, pay later (BNPL) services may be reducing your chances of securing a mortgage, brokers have cautioned. According to an exclusive survey shared with the Money blog, even borrowers with a "perfect credit score" and only "a few" BNPL transactions have faced mortgage rejections.

Broker insights

Several mortgage brokers reported that regular BNPL usage has led some clients to be turned down by major high street lenders. They are urging banks and lending institutions to reassess how they evaluate applicants whose credit files show BNPL activity.

“Borrowers with a perfect credit score and a few buy now, pay later transactions have been declined mortgages,” brokers told the Money blog.

Response from BNPL companies

Two major BNPL providers responded to the findings, arguing that their services are innovative and beneficial. They suggested that the wider financial industry needs to modernize its approach to credit evaluation to match evolving consumer habits.

They stated that they “provide innovative services” and that “the rest of the financial industry should catch up.”

Understanding BNPL and data sharing

BNPL programs enable consumers to split payments for their purchases without interest. Data from the Financial Conduct Authority indicates that nearly 11 million Britons currently use such services. Lenders use shared credit information to track payment behaviors and assess potential borrowing risk.

Author’s summary: Regular BNPL use may negatively affect mortgage approvals, even for borrowers with excellent credit, as lenders tighten scrutiny of spending habits.

Sky News — 2025-11-04