Home loans for people with bad credit
You may have made some mistakes in the past, or you may simply have never built up a steady credit history. Either way, if you find yourself struggling to find home loans for people with bad credit, it can be very upsetting and frustrating.
Your enthusiasm and excitement at buying a home can quickly be extinguished if you find that bad credit 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 affect their credit history.
With this in mind, many lenders are prepared to give people a second chance and still offer home loans to people with bad credit.
Always do your research as often these will have higher interest rates (calculated on the element of risk involved to the lender) so make sure you’ll be able to pay these bank on time.
The two main approvals needed if you’re looking to borrow more than 80% of the value of your property are from the lender, and from the mortgage insurer (this is the person who will protect the lender in the case that you’re not able to pay back the loan).
You can actually avoid your application having to be assessed by a mortgage insurer if you’re able to gather funds that will cover more than 20% of the deposit as well as associated costs such as stamp duty and legal fees.
Researching all of your options is definitely key to finding a home loan with bad credit. Use online resources as much as possible and always take the option to speak to advisors directly as often 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- this could be especially damaging if the applications are consistently declined.