BAD CREDIT MORTGAGE
For those who have bad credit, looking for a mortgage can seem like an uphill battle to find a lender.
For those who have bad credit, looking for a mortgage can seem like an uphill battle to find a lender. Banks, credit unions and default insurers will be looking for a credit score of over 640, but those aren’t your only options for being approved for a mortgage with bad credit. At Coverage Matters, we can help you find reputable alternative lender (B lenders) and private lenders that will provide you with options for bad credit mortgages in Brampton and Mississauga.
First, you’ll need to know the full extent of your credit score before you look into your options for bad credit mortgages. For a small fee, you can pull your credit score from credit bureau services like TransUnion and Equifax. You might also have a hunch that your score has been impacted by financial situations like missing bill payments, taking on too much debt, or even declaring bankruptcy. All of those scenarios will bring your score down.
How banks and Insurer evaluates:
Canadian Banks and Default Insurers want a credit score of 640 or more (but you should aim for over 680 in most cases).
If you have a credit score of 550 or more, many Alternative Lenders will approve you for a mortgage, with some additional information and contingencies.
If your credit score is lower than 550, we will more than likely need to explore options through a reputable private bad credit mortgage lender.
We can get you approved:
We can help you tap into a network of Alternative lenders who will help you get even a bad credit mortgage approved, especially if you have at least a 20% down payment.
If private lending is necessary, the good news is that private lenders don’t need a credit score to provide you with loan options. Often, these lenders will instead evaluate the debts on the property, and they appraise the home based on its estimated selling price. That way, they can safely register a mortgage against the property, meaning they’ll get their money back if your mortgage ever falls into arrears. Traditional Banks won’t take the chance, that’s why they almost solely look at income and credit scores.
The trade-off is that you’ll usually require a higher percentage available for your down payment, and for taking on the risk, Alternative lenders and private lenders will charge you a higher mortgage rate. However, Alternative lenders are giving you the opportunity to get a mortgage when the banks won’t. Those with poor credit scores should consider all their lending options.
Need any help!
The best way to start is to have a free initial consultation. Contact us or send us your details via call or by email.