Bad Credit? You Still Have Options
Do you have a bad credit rating or score? If you do, you might find it hard to secure a home loan. While this can be frustrating, there are options available that can allow you to purchase your very own home.
Here are some tips for securing a loan with bad credit.
Find the Right Lender
Almost all lenders use a special computerised credit scoring system, which assesses an individual’s loan application. What this means is that the information that you give them at the time of your application is given a score or rating. If the computer marks most items as being risky or negative then your application is rejected.
If you apply with a lender who does not use this system, you’ll have an opportunity to speak to someone face to face and explain your individual circumstances. Explaining your case and why you’re in a position to qualify for a loan goes a long way.
Demonstrate Your Improved Situation
If past circumstances led to your bad credit score, you will need to demonstrate your improved financial situation to the lender. This means you will have to show them that you are up to date with all your loan and credit card repayments and other payments like rent and utility bills. Having a stable income will also help to demonstrate this.
Opt for an Expert Lender
There are various levels of bad credit history. Depending on how severe your situation is, you may be better off opting for a specialist lender that offers products to suit you.
You might find that the interest rates for these special products are higher than usual but most clients only stay with these products until their credit situation improves.
Discuss Your Credit Score
There are many credit repair institutions that may help you to clean up your credit situation. It would be better to speak to them prior to applying for home loans. This could greatly increase your options for securing a loan.
Shop around with Caution
It’s important that you don’t apply with too many lenders as every time you make a request, it will be shown on your report. The more declines you get, the more it will impact your credit report. If you go to an expert Mortgage broker, your application will be assessed and you will get an idea of who is most likely to process your application.
If you want to discuss your credit score and apply for a loan, speak to Multi Choice Home Loans. We are among Queensland’s best mortgage broking companies and we have more than 15 years of experience.
Contact Multi Choice Home Loans on 1300 36 36 99 or use our online form. One of our friendly local brokers will be in touch. In the meantime, use our online calculator to estimate how much you can borrow.
For more information on loans and bad credit, check out our blog about what type of lenders you should consider.