10 Tips on Fixing Bad Credit

Most of the people in Canada find themselves victims of bad credit where they are affected negatively. They
find themselves victims of the bad credit ratings for the reasons beyond their capabilities. Some may be ill; they
may have lost a job while others find themselves in this situation by not understanding the consumer credit.
When a bad financial situation happens to good people, bankruptcy sometimes is the only way out. That should not be
considered as the end of everything as there are some strategies that can assist you get your credit back on
track and you can be entitled again to mortgage even after bankruptcy. It will be very frustrating to move from
one financial institution to the other only to be declined. Here are the 10 strategies you should consider so as to
get your credit back:

1.Locate The Right Lender

There are some lenders who will not approve the mortgage the moment they will realize that a bad credit
appears in your credit report. This implies that you have to select the right lender who will decide whether to
approve or not based on your current financial position not the bankruptcy you had. Such lenders will approve
the moment they will realize that you are capable of paying back.

2.Consider The Length Of Time Since Your Bankruptcy Discharge

The different lenders have different criteria on this. Most of them will consider those with two years after
bankruptcy with a proof of being re established after the bad credit. There are some who can lend even those
with recent bankruptcy but you should seek advises from a mortgage expert like the team at Capital Mortgages so as to guide you on those types of
lenders.

3.Consider Your Reasons For Being Bankrupt

If the reasons were beyond your control, then most of the lenders will approve the mortgage as it is not your
fault. If the reasons are as a result of poor management, excessive debts and many other reasons that can be
controlled, then it will affect the lender’s approval.

4.Consider The Size Of Your Down Payments

With your past bankruptcy, most of the lenders will consider at least 10% down payments including your own
funds that are not borrowed or given as gifts. In some cases, down payments of 5% or less may be allowed.

5.The Type Of Property

Some of the lenders will consider row townhouses or just houses. Very few lenders do consider apartments or
the stacked townhouses which may involve the stringent basis to qualify.

6.The Credit Report

This is meant to show your financial health based on your past behaviors. This will guide the lender on how
capable you are to repay. You can obtain a copy of your credit report from Trans Union (1-800-663-9980) or
Equifax (1-800-465-7166).

7.Your Credit Score

This is meant to reveal your credit worthiness. It is a summary that will translate your personal information from
the credit report and any other relevant sources into a 3 digit number that will represent the overall credit
worthiness. The borrower’s credit score will determine the rates of the mortgage. The higher the credit score,
the better the rates. Besides, there are those lenders who will set the minimum credit score requirements for
those borrowers with bankruptcy.

8.The Rate Considerations

Those borrowers with bankruptcy will have a higher rate than those with clean records. Besides a lender may
charge a lower rate if some basic lending criteria are met such as two years since bankruptcy, healthy beacon
score, a perfect debt servicing ratios and long term history of job stability.

9.The Re-establishment Credit

This is meant to inform the lender that you have been managing very well since bankruptcy. it will include the
payments of the recent on time loans on the banks if any. It is very important to know that any default will be
included in the credit report for the next six years and this could be the ground for the lenders to decline your
application.

10.Seek Advice From A Licensed Mortgage Broker

A licensed Capital Mortgages agent will guide you on the basic steps to rebuild your credit score.  Our mortgage brokers will also give you the tips on how to get a mortgage even with recent bad credit.