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April 1 at 8:47 AMComments: 0 Faves: 0

How To Get Mortgage Pre-approval With Bad Credit In Canada

By Syed Mortgage More Blogs by This Author

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There are several reasons that cause bad credits, some of those are mentioned below:-

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    Job Loss

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    Low Credit

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    Stability of Job

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    Family issues

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The reason could be anything but it affects the credit score and possibilities to get a mortgage. Especially, if you are a First Time Home Buyer Mortgage seeking person, things are going to be very difficult for you to get Pre Approval Mortgage from any lender.

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Forget about the reasons, actually dont worry about now because there are some ways that can help you get Pre Approval Mortgage. Before you get excited, on this mortgage rates are going to be higher.

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Before proceeding with the ways to get pre-approval mortgage from a lender, lets quickly understand about credit score and ways to get it checked.

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What is a credit score?

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A credit score is a three-digit number that is determined bases on your capabilities to handle your credits in your past. These three numbers indicate the lenders that how good you are when it comes to managing the money flow. Apart from this, the higher the score means lower the mortgage interest rates.

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How can you check your credit score?

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There are two ways to get your exact credit score, first one is to go to Equifax and TransUnion office to get your complete credit score with descriptive details but this is going to cost you some amount.

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The second way is to go for Free Credit Score tools (RateHub.ca) that can you give you credit score for free but they wont give you a complete descriptive about your credit details.

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Now, I hope you are clear with a credit score. So, its the correct time for us to discuss how you can get First Time Home Buyer Mortgage approval.

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Ways to get Pre Approval Mortgage from lenders.

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#1. Increase your credit score

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The best way you can get a mortgage at a lower interest rate is to get a good credit score. I would say, wait for a few months and increase your credit score because a bad credit score can cost you way more than a slightly better credit score can. In order to improve your credit score make sure of the following things for the coming few months:

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Pay your bills on time

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Dont apply for loans frequently

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Dont spend too much of your credit

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Increase credits in your account

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With these particular things, you will be able to improve your credit score significantly.

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#2. Save a larger down payment

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Before applying for a mortgage, you have to save at least 20-25% of your mortgage. Saving larger down payment will help you get rid of mortgage default insurance and high profile lenders can easily be impressed with it. Generally, a credit score isnt the only thing lenders look at. Larger down payment will show that you are financially stable to pay your monthly mortgage payments.

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#3. Find a bad credit mortgage lender

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If there are high profile lenders then there are some lenders that can approve your mortgage even with a low credit score. But before applying for a mortgage to such companies, let me tell you that these companies will cost youre a lot as the mortgage interest rate.

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Final Verdict

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There are several other ways that can get your pre approval mortgage from lenders but I have mentioned those that can be easily approached. As an individual, it will be easy for you to follow any of the ways to mortgage approved.

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