If bad credit is getting in the way of you getting the mortgage you need, earning back credit may prove that you are more reliable. The most common way to earn back credit or improve your credit score is by using a credit card that is secured. Using this type of credit card frequently and correctly can give your credit score the boost that you may need to get that mortgage. Another method our team recommends for improving you credit score is getting a non-prime mortgage.
In terms of using a credit card, pay it back on time for around 12 to 24 months continuously without missing a payment, be sure not to exceed 60 percent of the spending limit on the card and always make more than the minimum payment. These will get you on the road back to a good credit rating. Always be sure to do your research into what card will be right for you, as cancellation of a credit card will be bad for your overall credit score.
Ontario Bad Credit Mortgage Loans
Factors To Consider with Bad Credit
When looking for a mortgage that isn’t a prime one, these factors can potentially help or hinder your search:
• High debt; getting into a large amount of debt will most likely serve as a warning sign for any future lenders that may consider you.
• When looking at taking out a mortgage, the more money you put down up front, the better the rates will tend to be.
• Employment. If you are not in a stable form of employment, getting a mortgage or even a loan may prove difficult. If you have a history of short employments, this can affect how much lenders may be willing to lend and for how long.
• The lender that you go with will affect how much you pay. Private lenders will always charge more for lending you money.
• Property. The type of property that you own will affect if lenders will consider you or not. If you have a property that is not very marketable, lenders may tend to deny you any funds. Simply put, if they are forced to foreclose, they want a property that is easy to sell.
So above are some tips from our team as well as aspects to consider when looking for a mortgage with bad credit. Our last recommendation is to consider trying to improve your credit score before locking down a mortgage deal.