Your personal credit rating is your ticket to a mortgage and future home ownership. The better your credit rating, the easier it is to be approved for a home loan. Conversely, if you have a poor credit rating, it’s likely you’ll find it very difficult to be approved for a home loan.
But Bank Said No, an Australian mortgage broking firm that specialises in matching borrowers to the right lenders, believes you should not despair if you have a bad credit rating. It is possible to improve your credit rating, find the right lending organisation, and put together a strong case for a home loan.
Calculating Your Credit History
Your credit rating is calculated from your entire financial history. So, if you have defaulted on a loan, been declared bankrupt, had a bad history of credit card debt, or if you rent was so badly in arrears that your landlord reported Guaranteed Bad Credit Home Loans the matter, you may have built up a history as a bad credit risk. Perhaps you have also applied for credit or a loan over recent years, and been refused. All this contributes to your poor credit rating.
Tempting as it may be, don’t duck for cover. Face the fact that you have a poor credit rating.
Once you have all the information about your credit score, you are in a position to start planning. At the beginning, it may seem that the road to financial recovery and a good credit rating is impossibly long. It is not. As time goes on, it will become more and more easy, and you will enjoy the benefits long after the temporary ‘pain’ has passed.
Restoring Your Creditworthiness
A thorough understanding of the details of your credit situation puts you in the best position to work out a plan to improve it, and develop a strategy to identify the right lending home mortgage organisation to approach. Bank Said No believes it is never too early to approach a mortgage broker, who can advise on the best recovery strategy, identifying an appropriate lender, and when and how to approach that lender.
Draw up a strict budget and stick to it. This impresses any lending agency, because they will see immediately that you are genuine in your wish to improve your credit rating. Ensure your budget includes a regular savings plan, so you can point to a growing ‘nest-egg’ when you talk to a lender. This will help prove you are disciplined, and capable of paying back a large loan.
Stable employment is critical to being able to pay back any loan, and you need to be able to demonstrate to your potential lender that you are settled in your job. Don’t overlook the value of pointing to other assets you own as a demonstration of your improving creditworthiness, for example, a life insurance policy, if you have one. If you own your motor vehicle outright, this is a demonstration that you have been able to purchase a big-ticket item.
Bank Said No believes that most people can recover from poor credit ratings, and that, with the right help, they can obtain a home loan to begin the journey to home ownership. Click here to read more about improving your chances of securing a home loan.