An unexpected circumstance in your life may have caused you to miss financial payments thus resulting in a bad credit rating. Truth is, you are not alone. Even those who strived hard to keep a good credit rating come to a point of hardship in their lives. But it’s not all bad news. You still have options if you are looking to applying for a home loan. First things are first though, you will have to work on improving your financial status in order to move on.
Improving Credit for People With Bad Credit Scores
How to Start Fixing Your Bad Credit?
It is advisable to first take a look at your financial standing. Begin with getting a copy of your credit file through Veda, Experian, or Dun and Bradstreet. Review your credit history and determine where the gaps are so that you can start fixing them.
- Do you have outstanding debts or unsettled bills? Take the necessary steps to settle your outstanding debts. You can call them and see how to start making payments.
- Late payments? Make sure to start making payments on time. If you believe a late payment report is an error, you can call the company and come up with amendments.
- Loan or credit application rejections? If you have already been rejected, avoid making frequent loan enquiries. Instead, hold back and put up some savings.
As you start making regular payments to outstanding debts, you will see improvements to your credit file report. Lenders would like to see that despite having a bad credit, you are doing something to improve your financial standing.
You can always seek outside help to improve your situation. You can employ the help of a credit repair service or get financial counselling too. There are many ways to get out of a bad credit status. All it takes is patience and diligence from your part. Soon enough, everything will fall into place.
Bad Credit Home Loans and Getting a Loan Specialists
After you have started fixing your credit, you can start looking for specialized lenders who extend bad credit home loans. Many lenders are extending bad credit loans to borrowers to help clear negative reports on their credit. However, these lenders can charge you higher interest rates. Some lenders may also impose Lender Mortgage Insurance, so you will have to be ready for this but some lenders may have other options too. When applying for bad credit home loans, you will have have to be as transparent as possible.
Lenders are looking at two things when investigating a borrower’s eligibility – stability of income and credit history. So if you have a stable source of income and a gradual improvement to your credit history, lenders can eventually trust you and offer you a home loan.
Talk to a Home Loan Adviser
You don’t have to go through the burden of fixing your credit and getting a home loan on your own. You can actually get the help of a home loan adviser. They can help you figure out ways to improve your credit report. Top of it, they can help you make a plan to straighten your credit file and match you with a lender who can actually help.
There is always hope for people with bad credit. But you will have to start from the very beginning in order to straighten things and get the reward. While there are no shortcuts to fixing a bad credit, it is still good to know that you can acquire a home loan with due diligence.
Ready to take the step towards in buying your own home even with bad credit. Fill up this quick application form as Intellichoice helps you in acquiring your dream property.