Home Loan Variable: 5.94% (5.95%*) • Home Loan Fixed: 5.79% (6.39%*) • Fixed: 5.79% (6.39%*) • Variable: 5.94% (5.95%*) • Investment IO: 6.14% (6.58%*) • Investment PI: 5.99% (6.61%*)
WHAT IF I HAVE A BAD CREDIT HISTORY OR OUTSTANDING DEBTS?
We believe that former adversity shouldn’t impact upon your ability to get a home loan, and we specialise in sourcing suitable products for those that have experienced adversity via a less-than-stellar credit history, bankruptcies, defaults, Part IX debt agreement, or judgments. Sometimes life gets in the way of your wealth creation or home-ownership goals, so we help you get back on track with finances specifically suited to your circumstances.
While the larger banks are typically more conservative with their risk assessment, we have a number of other lenders on our panel that may place ‘restrictions’ on your borrowing, but the products made available are still competitive and will enable you to enter or re-enter into the property market.
Note: Many credit defaults or errors on your Credit File may be contested or removed. You should read the appropriate FAQs for a better understanding.
Some minor defaults won’t qualify you from some of more robust products offered by bigger lenders. Minor defaults under $500, for example, may still qualify you for a 95% product (5% deposit), while you still may be able to borrow up to 90% if you have experienced other types of hardship. Borrowing up to 80% of a property is usually not a problem regardless of your credit history.
What is Bad Credit
If you do have bad credit it’s likely you’ll find a record of it on your credit file. Many of the marks on your file may impact on your suitability for a big-bank product, but they won’t necessary qualify you from other (often very competitive) lenders.
Marks that may compromise your borrowing include the following:
- Mortgage arrears. A bank will not generally refinance your loan if you have missed just one repayment in the last 24 months. Various lenders have different policies.
- Bad Credit History. Adverse listings such as defaults, bankruptcy, judgments, court writs or too many credit inquiries on your Equifax credit file may cause a lender to question your suitability for their products.
- Lender Credit History. A bank never forgets. They have long memories and tend to treat former customers with bad credit with a particular brand of contempt. A new lender is probably better suited.
- Unpaid Bills. Outstanding bills such as council rates or tax bills may not initially show up on your credit file but will likely reveal themselves in the supporting documents you need to provide.
- Company Trouble. If you’re the director of a company that is in financial trouble, receivership or liquidation then this can affect your personal credit history.
- Over Committed. It’s always best to unload your personal debt burden before applying for a loan as it impacts upon your borrowing capacity.
Getting Approved
You can still get approved for up to 95% of the property despite the hardship that caused your current problems. The maximum borrowing LVR, and the rate applied to your product, varies depending upon current outstanding debt and the extent of your circumstances.
We have a number of non-conforming lenders on our panel that apply rates and conditions based on their assessment of their risk. You should call us now and have a quick discussion; there are steps you might be able to take now that’ll improve your changes of better borrowing opportunities.
Your Circumstances Change
While the rate applied to a non-conforming product is higher, and the features may not be as extensive, your circumstances and financial position will change over time. We keep in regular contact with you so that when you qualify for a product that offers savings you’re able to take full advantage of the move.
RELATED FAQS:
A Risk Fee is a once-off charge payable by you when the amount of money you borrow for the purchase of a home or asset if higher than that lender’s acceptable LVR. For a home loan, this is usually 80% of the value of the home (80% LVR) …
Most lenders have moved away from the no-deposit home loan, although there are a few products available with very strict criteria. Excluding the no-deposit opportunities made available to the medial industry and other …
When you apply for a home loan, a lender will take a large number of factors into consideration when deciding whether or not to approve your application. The Serviceability assessment determines if you can comfortably “service” the loan repayments after considering all of your …
SHARE THIS FAQ
❯ Home Loans ❯ Car & Equipment Finance ❯ Mortgage Calculators ❯ FAQ ❯ Resources ❯ Education ❯ Insurance ❯ Real Estate ❯ Business ❯ Review Bank Products ❯ Search BSB Numbers ❯ Social Media Archive ❯ Video Archive ❯ Downloads ❯ About Us ❯ Finance Team
The comparison rate is calculated on a secured loan of $150,000 with a term of 25 years with monthly principal and interest payments. WARNING: This comparison rate is true only for examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Important Information: Applications are subject to credit approval. Full terms and conditions will be included in our loan offer. Fees and charges are payable. Interest rates are subject to change. Offer does not apply to internal refinances and is not transferable between loans. As this advice has been prepared without considering your objectives, financial situation or needs, you should consider its appropriateness to your circumstances before acting on the advice.
© LOAN SAFARI ABN 94 143 496 100 ACL 384704 | PRIVACY • TERMS • DISCLAIMER