You are looking to get a mortgage to buy a new home or to refinance and you have bad credit. For some this is a total surprise and for others they are fully aware of it, but it could not be helped, as the bad credit was the result of a business failure, unemployment, a separation or a critical illness or accident in the family.
Over the years we have helped so many clients get loans who have had a glitch with bad credit or poor repayment history. What we have found is that it is best to lay all the cards on the table and look at how we can resolve the situation. This may mean that a Non Bank loan has to be arranged to repay or refinance all the outstanding debts so you can start afresh. Refinancing and consolidating debts is a great way to put all your bad credit problems in one basket, so you can then focus on paying them off as fast as possible.
At times it is best to contact the people that you owe money to and offer a full and final settlement. We can help with this and significant discounts have been arranged. Would you like to contact us now?
Now bad credit issues do have varying degrees of seriousness with lenders. Once upon a time an unpaid TV licence was a common occurrence, this was not of any major concern to a lender. Now we often see collections relating to Gym memberships, these too are not a major. What is a concern though, is a regular pattern, where you are not paying your doctor, solicitor, credit cards, car loans etc.
But, the good news is that if you have at least 20% equity in your property, or as a deposit, there are now options to buy and refinance available, right up to 80%, even in these difficult times when bad credit is becoming more and more common, but there are only a few lenders in the market. Often these lenders are known as "Bad Credit", "Non-Bank" or "Sub Prime" as they consider and often approve the loans that the mainstream banks do not regard as their "prime" business. Whilst 20% would be the minimum deposit or equity with an 80% loan, this can increase significantly to even to say 50% depending on the type of property, location and how bad your credit history is. Bare land, run down, incomplete with no code of compliance, leakers and remote properties are examples where a loan as high as 80% would not be available. Unsure if your property would be suitable just ask us!
Ex or Discharged Bankrupt or NAP? We are currently receiving an increased number of enquiries from clients who were made bankrupt, but are now discharged. Ex Bankrupts are looking to start again with a home, business. or commercial property purchase. These bankruptcies are often the result of the Global Credit Crisis. We have helped a number of people, but the key requirement for success is a solid lending proposal with good income and say 20% deposit, as all lenders will be cautious.
The first action you need to take when looking for a bad credit loan is to write a list of all your bills and credit issues outstanding. Honesty is really important here, if you are looking for a second chance and to refinance let’s do the job properly. The next thing to do is write down an explanation on why things went wrong and what you can do better in the future, so that you do in fact start on a new path. We might be able to give you some good ideas on this. This is especially important for an ex bankrupt as a prospective lender will want to have an idea of how much and who had to write of loans or invoices. Lenders have long memories and what they can't remember they google, never try to hide anything!
Non Bank, where you go if your finances hit a speed bump!
Kim, Tussock Buster Trail Ride, Waiouru, March 2015
So if you need to buy a commercial property or a residential home loan with bad credit history, or to refinance, consolidate or to buy an investment property contact us now, we are always prepared to listen!
Cherish your good credit record, it's worth guarding
From an article by Diana Clement NZ Herald 27.7.2013
"Anyone with credit score issues who wants a mortgage should consider using a mortgage broker. Brokers have relationships with lenders and can sometimes get a difficult case over the line.
Kim Lyons of First Rate Mortgages says he gets clients to write the story around defaults in their own words and he will send this and his assessment of them to the lender. With the full picture the lender may then be prepared to advance a mortgage. If not, Lyons might consider using a non-bank lender for a year or two until the client has built up enough of a payment track record to qualify for a mainstream mortgage.
If a client has an outstanding debt, no matter how small, Lyons will recommend they pay it back.
Having a default but no money outstanding looks better than a default and unpaid debts".