Sometimes, a difficult past is standing in the way of a bright future. Bad credit can do that to you. After all, credit history is an integral part of the mortgage approval process.
If you’re running into roadblocks or don’t think you can get mortgage financing, don’t give up. It is possible to get a mortgage with bad credit! And it can be a very important step in getting you back on track financially should you need to pay off a significant amount of debt.
One of the primary advantages of working with a mortgage broker is the access you get to a wide range of lenders, including institutional and private lenders that specialize in bad credit mortgages. While the guidelines are different for each, these lenders look at your overall situation and entire credit history, and some will consider your application even after a consumer proposal or bankruptcy. For certain areas of the country, primarily large metropolitan areas, there are lenders that will lend just based on the equity in a home.
Keep in mind that even though you will have a higher interest rate and may pay additional fees, bad credit mortgages are typically short term i.e. 1 year term. During this time, we can work together to improve your score and then look to move you to a better rate longer-term mortgage.
If you don’t have an immediate financing need, or your situation is such that you don’t qualify with one of these lenders, there are ways you can make up for bad credit, which include:
- Increasing your downpayment to 20 per cent or more.
- Asking a trusted friend or family member to be a co-signer. Your co-signer will need a good credit score and have the capacity to be responsible for the mortgage if you are unable to handle the payments.
- Or consider taking the time needed to repair your credit first. A much improved credit situation can save you the cost of a higher interest rate and less favourable terms.
If your past is standing in the way of your future… get in touch with the experts at MiMortgage.ca at 866.452.1100 today and let’s chart a course to get you where you want to go.