Home loans for people with bad credit

By Tom Caesar - January 13, 2015

If you find yourself struggling to get home loans approved, it can be very upsetting and frustrating. Either, you have made some mistakes in the past, or you simply have never built up a steady credit history. Your enthusiasm and excitement at buying a new home can quickly be extinguished if you find that a bad credit score is stopping you from gaining access to the money that you need.

Don’t give up

It’s important to remember that banks and loan providers understand that people make mistakes, and often have exceptional circumstances that really affected their credit history.

With this in mind, many lenders are prepared to give people a second chance and still offer home loans for people with bad credit.

Always do your research as, more often than not, these will have higher interest rates (calculated on the element of risk involved to the lender). So make sure you’ll be able to make payments on time.

If you’re looking to borrow more than 80% of the value of your property, there are two main approvals needed. The first is from the lender and the second approval is from the mortgage insurer, this is the person who will protect the lender in case you’re not able to pay back the loan.

You can actually avoid your application having to be assessed by a mortgage insurer. Just make sure to gather funds that will cover more than 20% of the deposit as well as all associated costs and fees.

Doing research on all of your options is definitely key to finding the ideal home loans for people with bad credit. Use online resources as much as possible and always take the option to speak to advisors directly as they will have the most up to date advice from a variety of sources.

You need to be careful however about making actual applications as each time you do this it will be recorded against your credit report. And this could be especially damaging if the applications are consistently declined.

Tom Caesar
Tom Caesar
Tom Caesar is the Managing Director of The Positive Group, a group of Australian financial services companies offering a broad range of finance to clients Australia wide. The Positive Group assist clients in the areas of car finance, mortgages, insurance & wealth management. Tom has been in car & asset finance for over 10 years. Tom regularly contributes articles on car finance, insurance, technology and business growth, drawing on his experience of starting his own brokerage in 2009.



January 13, 2018

i need it 4 a deposit 4 home

Angela Monroe

March 20, 2018

Hi Raymond,

You can’t borrow money for a home deposit, unfortunately! You’ll need to set up a savings plan to save the amount, or you could have a relative go guarantor for you. If you’d like more information, you can chat with one of our brokers, who can help you set up a strategy to reach your goal of home ownership.

Sorry, the comment form is closed at this time.

  • Quick Quote

  • Related Posts