Bad credit mortgages are always an option for those with a lacklustre history with credit products. Regardless of how these circumstances came about, bad credit scores limit your borrowing options, which can make securing property a difficult undertaking.
However, there are a number of ways to work towards repairing your credit score, which could help boost your chances of securing a better home loan option.
Take out a credit card
Contrary to popular belief, having a credit card can actually help you build up your credit rating. While this isn’t to say that you should use it for everything, making small purchases with your credit card and paying back the balance in full and on time can go a long way to restoring your credit credibility and even aiding the growth of your rating.
If you’re unable to secure a normal credit card, talk to your bank about a secured credit card. These work in much the same way, except they have a spending limit equal to the deposit you put down on the card. Using this in much the same way will help you recover lost credit rating.
Increase your own financial stability
Lenders love to see people who look like sturdy and reliable. If you can prove that you have a steady income or provide evidence of decent savings, you may be able to help your own standing as a borrower. Furthermore, owning large assets like property or a vehicle will strengthen this appeal, helping you with your finances in the long run.
Double checking your credit reports regularly
Sometimes errors can slip through the cracks, causing your credit score to be negatively affected by things you had nothing to do with. Chasing up your credit status and double checking it at regular intervals (usually annually) will allow you to stay on top of any errors that may have occurred.