What Constitute Bad Credit in Canada?
For mortgage, credit score lies in the range of 300 to 900. In Canada, if you have a credit score below 550 then it shows the Bad Credit. In this situation, it’s difficult to find a bad credit mortgage lender.
What Credit Score Required By Lenders In Ontario, Canada?
Most lenders deal with their customers based on their credit. Here, it’s imperative to understand that what’s the lender’s requirements for your credit score.
- In Canada, major banks approved mortgage if you have a credit score of 600+.
- Trust Companies also don’t compromise on credit score and have criteria of 550+.
- Some best lenders like lowinterestsmortgage provide variations and also accept below 550.
A question will come to your mind that how you will check your credit score? Stay here we will guide you about Bad Credit Mortgage completely.
How To Check Your Credit Score In Ontario, Canada?
There are two ways for mortgage borrowers to check their credit scores;
Two major Canadian bureaus named; Equifax and Transunion.com are available to calculate your credit score. You can visit these websites to order a copy of your credit.
- Lowinterestsmortgage Method:
Our competent Bad Credit Mortgage team is available 24/7 to assist you. We can provide your credit score report as well as your credit history free of any charges.
You have understood about bad credit and you also understood that your credit score is below 550 means you have bad credit. What will be the next step?
How To Get Mortgage With Bad Credits In Ontario?
If you apply for a mortgage and due to bad credit you rejected by your bank may cause frustration. To tackle this tricky situation our bad credit mortgage teams enlists some tips to get approved for a mortgage even with bad credits.
Tips To Get Approved Even With Bad Credit In Ontario:
- Prepare Strong Down Payment: Down payment can hide your credit score problem. If you have decided to get approved for a mortgage then you must prepare a down payment between 15 to 30% down for commercial as well as a residential mortgage. It may also change depends on your lender but if you invest more percentage then more chances to get approval.
- Proof Of Monthly Income: To get mortgage income matters a lot, the borrower provides proof of monthly income. It shows that borrower can pay off his loan or mortgage. Lenders use Gross Debt Service Ratio Formula to determine the monthly income. In a situation, if your credit score lies below, 550 then this ratio must be more than 30% or about 35%.
- Professional Property Appraisal: A good appraisal can also impress your lender and they will be motivated to give you a mortgage even in bad credit. Because a promissory note or an appraisal shows that the borrower has property more worth than the amount of mortgage.
- Smart & Reliable Co-signer: An expert partner or smart friend who has a good credit score can also make your bad credit mortgage approval easy. If you have bad credit and your co-signer gives security to your lender. The lender will feel free and comfortable in giving a mortgage even with bad credit.
- Another Collateral: As, large down payment or co-signer, these possibilities do not meet in time then don’t worry. You have an option to add any other second property or friends property as collateral. Because the lender can also calculate your mortgage ratio based on cross collateral property.
Despite Bad Credit, important options can help you in getting a mortgage easy approval.