Buying a home is a big step, especially for first-time home buyers. This is why it’s important to know what the process entails, and what you’ll need to qualify. But it’s not only for people with an excellent credit record, you can still get a mortgage with a bad credit history. Mortgage brokers in Oakville will agree that it’s worth applying for a mortgage, even if you have been approved for bankruptcy.
Having a bad credit score will certainly make it harder to get approved for a mortgage but it is not impossible. You have to follow certain guidelines to improve your chances of success. It starts with finding a lender that will be willing to offer you a mortgage, even if it means moving to private lenders if banks do not approve your application.
How to Get a Mortgage
The mortgage industry is increasingly competitive and there are many private lenders that are willing to give mortgages to people with bad credit scores. You will be judged against the same guidelines, but you may need to put down a larger down payment. If you put down a larger payment, there are less chances for you walking away from your payments since you’ve already put a lot into it. It’s all about risk when it comes to applying for a home loan.
It’s always a good idea to pay off most of your debt when you want to apply for a mortgage. Lenders want to see that you have a budget available every month and that you have cash available to service your mortgage. It’s also important to show that you are paying your debt timely and that you’ll very likely pay your mortgage on time as well.
Another important fact to remember is that you may need a cosigner. This is common with people who have bad credit scores, as the lender will need additional security, should you not pay your mortgage anymore. This is an added layer of security for the lender. But keep in mind that if you cannot pay your mortgage, this person will be responsible for the payments.
Choosing to buy a home is always a good investment to make, even if you have bad credit. But the most important thing to remember is to make sure that you’ll be able to afford the mortgage. If you follow the basic guidelines and prepare in advance, you have a very good chance of being granted a mortgage, even if you don’t have a perfect credit history.
As leading mortgage brokers in Oakville, Mortgage Guys can assist you with applying for a mortgage, even if you have bad credit. We can also assist first-time home buyers, as well as mortgage owners who want to consolidate their debt.