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Lots of good people have had problems with bad credit, and when it comes to getting home loans, there can often be difficulties. Fortunately there are solutions.

Every lender out there makes money by lending to people who will pay it back over time.  They lose money by lending to people who don’t pay it back. Bad credit is a real issue when it comes to home loans. That doesn’t mean that life is pleasant for people who default on their repayments.  At the end of the day you and the lender are on the same side.  It’s in everyone’s interest for them to lend you the amount of money that you will be able to repay.

So, consider the reasons given by the lenders as to why they consider you to have bad credit. Work out whether or not that makes sense. If you are convinced that you are truly able to make repayments on a loan with a bit of a safety cushion, then there are some things that are able to help you. 

Some of them are obvious, such as giving enough time to be established in your job.  Demonstrate the ability to accumulate savings and avoid defaulting on your present obligations. You may want to check your own credit rating to make sure there is nothing there to cause issues. 

If you find something indicating bad credit, contact the other party involved and sort it out.  In some circumstances you may be able to be approved for what’s called a no doc or a low doc or a non-conforming loan. With those home loans you may pay a higher interest rate and there may be limits on the loan to value ratio, but you can get around a lot of the issues that would normally be a show stopper for your loan approval.

Hopefully in time you will be able to demonstrate the things that will allow you to be approved to refinance to a loan with a lower interest rate.

If you think you are in the category of one who can demonstrate the ability to repay a home loan but have been knocked back because you haven’t been able to tick all the boxes, give us a call on 13 72 62. There are solutions for many bad credit situations.