If you’re a Canadian with bad credit, you may still be able to get a mortgage. Here are some options available to you.
A bad credit mortgage is a mortgage for people with bad credit. There are many reasons why someone might have bad credit, such as:
- Missed payments on debts
- A history of bankruptcy
- A history of consumer proposals
- Having unpaid debts that have been sent to collections
If you have bad credit, it’s important to know that you’re not alone. There are many Canadians with bad credit who are still able to get a mortgage. In fact, there are several bad credit mortgage options available.
What is a bad credit mortgage in BC Canada?
A bad credit mortgage is a mortgage specifically designed for people with bad credit. There are many different bad credit mortgage options available, depending on your needs and your financial situation.
Some of the most common bad credit mortgage options include:
Private mortgages: A private mortgage is a loan that’s not from a bank or a traditional financial institution. Instead, it’s from a private lender, such as an individual or a company. Private mortgages are often easier to qualify for than traditional mortgages, because they’re based on the value of your property rather than your credit score.
Second mortgages: A second mortgage is a loan that’s secured by your home equity. Home equity is the difference between your home’s value and the amount you still owe on your mortgage. If you have bad credit, a second mortgage can be a good option because it’s easier to qualify for than a traditional mortgage.
Mortgage insurance: Mortgage insurance is an insurance policy that protects your lender if you default on your mortgage. If you have bad credit, you may be required to get mortgage insurance. Mortgage insurance can help you qualify for a mortgage even if you have bad credit.
How to get a mortgage with bad credit in Canada?
There are several ways to get a mortgage with bad credit in Canada. The best way to get a mortgage with bad credit is to:
1) Work on improving your credit score. If you have bad credit, the first thing you should do is work on improving your credit score. There are many different ways to improve your credit score, such as:
- Paying your bills on time
- Keeping your credit card balances low
- Making sure you’re not using more than 30% of your credit limit
2) Shop around for a bad credit mortgage. Once you’ve improved your credit score, you can start shopping around for a bad credit mortgage. There are many different bad credit mortgage options available, so it’s important to compare your options and find the best deal for you.
3) Get pre-approved for a mortgage. Once you’ve found a bad credit mortgage that you’re interested in, the next step is to get pre-approved for the mortgage. Getting pre-approved means that a lender has looked at your financial information and decided how much they’re willing to lend you.
4) Make a larger down payment. If you have bad credit, one way to make it easier to get a mortgage is to make a larger down payment. A larger down payment shows that you’re less of a risk to the lender, and it can help you get a lower interest rate.
5) Get a co-signer. If you have bad credit, another option is to get a co-signer for your mortgage. A co-signer is someone who agrees to sign the mortgage with you and be responsible for the loan if you can’t make the payments. Having a co-signer can help you get a lower interest rate and improve your chances of qualifying for a mortgage.
Bad credit doesn’t have to stop you from getting a mortgage. There are many bad credit mortgage options available, so talk to a mortgage professional to find the best option for you.
Your credit report and credit history
What is a good credit score?
A good credit score is a score of 650 or higher on the Experian Credit Score scale. A good credit score means you’re a low-risk borrower, and you’re more likely to qualify for a mortgage with favorable terms.
Your credit report is a record of your financial history. It includes information about your credit accounts, such as:
- Your payment history
- The amount of debt you have
- The length of your credit history
Your credit report is used to calculate your credit score. Lenders use your credit score to decide whether to lend you money, and if so, how much interest to charge you.
You’re entitled to one free credit report per year from each of the major credit bureaus: Equifax, TransUnion, and Experian. You can get your free credit report by visiting AnnualCreditReport.com.
What is a bad credit score?
A bad credit score is a score of 649 or lower on the Experian Credit Score scale. A bad credit score means you’re a high-risk borrower, and you’re more likely to be denied a mortgage or get a mortgage with less favorable terms.
What should I avoid doing when applying for a bad credit mortgage?
There are a few things you should avoid doing when applying for a bad credit mortgage:
- Applying for multiple mortgages. When you apply for multiple mortgages, it can have a negative impact on your credit score. Each time you apply for a mortgage, the lender will do a hard inquiry on your credit report. Too many hard inquiries can lower your credit score.
- Not shopping around. It’s important to compare your bad credit mortgage options before you choose a loan. Not all lenders are willing to work with borrowers with bad credit, so it’s important to find a lender who is willing to give you a loan with favorable terms.
- Making late payments. If you have bad credit, it’s important to make all your payments on time. Late payments can have a negative impact on your credit score and make it harder to get a mortgage.
- Applying for a mortgage you can’t afford. Don’t apply for a mortgage that you can’t afford. If you can’t make the payments, you could end up losing your home.
If you’re considering a bad credit mortgage, there are a few things you should avoid doing. By following these tips, you can improve your chances of getting approved for a mortgage with favorable terms.
Apply Now For Your Free Consultation With A Bad Credit Mortgage Specialist!
If you’re considering a bad credit mortgage, we can help. We specialize in Bad Credit Mortgages and can help you get approved for a loan with favorable terms.
We offer a free consultation so you can learn more about your options. Apply now and one of our specialists will be in touch.