Want to Apply for a Home Loan? Fix Your Bad Credit Now!

The best way to qualify for a favourable home loan is to look as good on paper to potential lenders as possible. We are Rockingham, Baldivis, Cockburn and Kwinana home loan specialists, and we’d like to ask you: Do you have blemished credit that is preventing you from getting approved or do you fear that it’s not even worth applying for a mortgage because of credit mistakes you’ve made in the past? Read on for some helpful info that can help you fix your bad credit as quickly as possibly, increasing your chances of qualifying for a home loan sooner rather than later.

Applying for Home Loans

Obtain Your Credit Report

Do you know what’s on your credit report? Things may not be as bad as you think. Then again, things could even be worse than you realise. The best thing to do is to obtain a copy of your credit report so that you can review it and see where everything is at.

Look for Errors

Is anything wrongly reported on your credit report? Your bad credit could be partly due to an error or omission. Credit bureaus have policies to follow to help people get wrongful listings removed.

Fix Listings that are Problematic

Is there something delinquent causing problems on your credit? The best way to fix your bad credit is to pay off those old debts. Talk to your creditors (phone numbers should be listed on your credit report) about this and you may, in some cases, be able to get them to agree to change their report.

Build Positive Credit

Start building positive credit as soon as possible. If you still have credit cards, pay them down and keep the balances low. Go on a budget that involves living on cash as much as possible and if necessary, obtain a secured credit card to help yourself re-build credit. Be careful about buying into any advertised promises to fix credit ratings. Some of these ads are not ethical and are not all that helpful. The best way to fix a bad credit report is to methodically and responsibly build new credit over several months’ time.

Save a Substantial Down Payment

A more substantial down payment is the best way to get approved for a mortgage when you’ve had credit problems in the past. Showing potential lenders that you have mended your ways and that you are financially responsible can be a good way to get approved, but nothing talks like money does in this situation so you may need to save more than 5 % of your down payment to help illustrate that you are, in fact, ready and responsible enough to take on the responsibility of a mortgage.

Whether you’re ready now or are hoping to be ready in the near future, we’re Rockingham, Cockburn, Kwinana and Baldivis home loan specialists who can help you maximise your chances of getting approved. Less than perfect credit could mean a higher interest rate, the need for a co-signer or a higher down payment, but the right steps taken by you could help you get on the right path to better credit and home ownership sooner than you think. Feel free to talk to us today.