Can someone still get a loan with bad credit?
- Thread starter jonesy
- Start date
Will depend on a couple of things:
1) Loan to valuation ratio required.
2) Severity of the adverse credit. Would imagine relatively minor from what you say.
3) Lenght of time these were registered and paid (If applic).
In most cases finance is available it just depends on the rate and terms and conditions.
1) Loan to valuation ratio required.
2) Severity of the adverse credit. Would imagine relatively minor from what you say.
3) Lenght of time these were registered and paid (If applic).
In most cases finance is available it just depends on the rate and terms and conditions.
In most cases, simply no, you will most likely have to fix these asap,
lenders dont take kindly to someone who has outstanding bills, believe me, I had a 600 dollar power bill that I paid my share on, three years later the guy still hadnt paid his share so I had to...
lenders dont take kindly to someone who has outstanding bills, believe me, I had a 600 dollar power bill that I paid my share on, three years later the guy still hadnt paid his share so I had to...
Yes, your friend can still get a loan. He will most likely have to go to a non confirming lender such as Bluestone or Liberty though. The rate and loan amount he can get will depend on how much the debts are, whether they are paid or unpaid.
I hope that helps.
Jonsey
This is a cut and paste from a major lenders policy
The key requirements which applicants must comply to is as follows:-
* Total aggregate borrowings must not exceed $1m
* Clear credit history - applicants allowed 1 paid default up to $1,000 with a financial institution and / or 2 paid defaults up to a total of $ 500 with non mortgage related defaults (e.g. telecommunications company).
* DSR must be less than 50% on our servicing calculator
Land size must not exceed 50 ha (125 acres) zoned rural residential. We have no minimum size restrictions on apartments, so long as the purpose is for permanent occupation, full kitchen facilities and separate fixed partition bedding area away from the main living area
If the application fails on any of the above, the application must go to the mortgage insurer.
So if your mate fits into this then you dont need a nonconformer...
That being said... options could be to get a security guarantee or larger deposit on the house to eliminate the MI altogether. Cheaper alternative than a non-conformer in a lot of cases and saves the MI premium
There are a few lenders if you head down the nonconforming path.
Regards
Richard
This is a cut and paste from a major lenders policy
The key requirements which applicants must comply to is as follows:-
* Total aggregate borrowings must not exceed $1m
* Clear credit history - applicants allowed 1 paid default up to $1,000 with a financial institution and / or 2 paid defaults up to a total of $ 500 with non mortgage related defaults (e.g. telecommunications company).
* DSR must be less than 50% on our servicing calculator
Land size must not exceed 50 ha (125 acres) zoned rural residential. We have no minimum size restrictions on apartments, so long as the purpose is for permanent occupation, full kitchen facilities and separate fixed partition bedding area away from the main living area
If the application fails on any of the above, the application must go to the mortgage insurer.
So if your mate fits into this then you dont need a nonconformer...
That being said... options could be to get a security guarantee or larger deposit on the house to eliminate the MI altogether. Cheaper alternative than a non-conformer in a lot of cases and saves the MI premium
There are a few lenders if you head down the nonconforming path.
Regards
Richard
Yea! I worked with a broker so maybe he just wanted to secure his payment though one might suspect..
He came back to me with the banks concearn and told me that the lender didnt look kindly towards it, he told me to fix it up asap to secure the loan.
He didnt want a measly $600 to screw my financial future up, and neither did I.
It was years ago and I genuinely thought he must have paid it by now, just goes to show, he's still stuck renting without his name on the power bill..
He lived upstairs for 3 months and managed to leave all 3 airconditioners on all day and night when he was working full time with no one in the house.. some mothers do ave em as they say..
Hi w2bw,
Lukentel's post states that only paid defaults are allowed. So, it makes sense that the loan would have been rejected with the unpaid default. Once you paid the default, it is marked as paid however the listing is still there in your credit history and can still have an adverse effect on your loan applications.
Ah yes Veda Advantage, (former Baycorps), whom I have crossed swords with earlier this year. If you scream loud enough someone listens.
I had a run in with a former creditor that bypassed all normal reasonable business terms when we sold our Newsagency. It was the sum of $27,000 owing, that our solicitor had failed to finalize. Any corresspondence should have gone to the solicitor, but didn't. We paid the outstanding amount within 3 months of settling. But not before a random debt collection agency, illegally lodged it with The Victorian Magistrates Court. The creditor wrote to us stating categorically, that it was paid, and that they had not lodged it with the court.
When it came time to finance a property, lo and behold Veda had it on record as being unpaid. Fortunately, whilst I was threatening Veda with legal action, it turns out that Gerard Malouf and Partners, is trying to gather enough clients that have suffered at the hands of these agencies. They are putting together a class action that they state will possibly be the biggest in Australian Legal history. Anyway, I just added this to the ammunition against Veda. They have no legal right to hold this information against any individual in any circumstance.
Within a day or two they had removed all record of any default. My mortgage broker asked me who I had taken out. he couldn't believe it when he checked my file, and it was clear.
In fact they removed it from my brother's file, as he too was a partner in the business.
Jonesy, I talked to a Lisa Ivers at Veda, although I think she may be on Maternity leave. You could try Anup Grover | ISS Customer Relations Case Manager | Veda Advantage DDI +61 2 9951 7563 | Fax +61 2 9951 7666
Tell them you are joining Malouf & Partners class action against them, and see what their reaction is. They are trying to put out spot fires, to minimize the huge damages that they face. Just remember that they have no right to hold yours or anyone else's credit information. Anyone who says the contrary is talking nonsense.
I have heard, on the grapevine recently that the Government is moving to close down these agencies and put in their own more balanced reporting administration.
I had a run in with a former creditor that bypassed all normal reasonable business terms when we sold our Newsagency. It was the sum of $27,000 owing, that our solicitor had failed to finalize. Any corresspondence should have gone to the solicitor, but didn't. We paid the outstanding amount within 3 months of settling. But not before a random debt collection agency, illegally lodged it with The Victorian Magistrates Court. The creditor wrote to us stating categorically, that it was paid, and that they had not lodged it with the court.
When it came time to finance a property, lo and behold Veda had it on record as being unpaid. Fortunately, whilst I was threatening Veda with legal action, it turns out that Gerard Malouf and Partners, is trying to gather enough clients that have suffered at the hands of these agencies. They are putting together a class action that they state will possibly be the biggest in Australian Legal history. Anyway, I just added this to the ammunition against Veda. They have no legal right to hold this information against any individual in any circumstance.
Within a day or two they had removed all record of any default. My mortgage broker asked me who I had taken out. he couldn't believe it when he checked my file, and it was clear.
In fact they removed it from my brother's file, as he too was a partner in the business.
Jonesy, I talked to a Lisa Ivers at Veda, although I think she may be on Maternity leave. You could try Anup Grover | ISS Customer Relations Case Manager | Veda Advantage DDI +61 2 9951 7563 | Fax +61 2 9951 7666
Tell them you are joining Malouf & Partners class action against them, and see what their reaction is. They are trying to put out spot fires, to minimize the huge damages that they face. Just remember that they have no right to hold yours or anyone else's credit information. Anyone who says the contrary is talking nonsense.
I have heard, on the grapevine recently that the Government is moving to close down these agencies and put in their own more balanced reporting administration.
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as noted prior
I think Richard Taylor put it very well in the 2nd response to the question.
In actuality you can get lends for defaults, whether paid or not paid but then the issue is if you have a legitimate unpaid default is ideally why you didnt pay it, how much it is for and how long ago.
If none of this comes up really rosy then you might be heading into rates into the double digits (as compared to the single digits for 'clear' clients presently).
I think Richard Taylor put it very well in the 2nd response to the question.
In actuality you can get lends for defaults, whether paid or not paid but then the issue is if you have a legitimate unpaid default is ideally why you didnt pay it, how much it is for and how long ago.
If none of this comes up really rosy then you might be heading into rates into the double digits (as compared to the single digits for 'clear' clients presently).
G'Day Jonesy
Firstly, in Australia we have a Credit Record, we do not have a Credit Rating.
Now that your friend is aware of the situation he/she should pay the outstanding accounts asap and get a receipt of payment from the suppliers. He / she should also request that the supplier record the payment on the Credit Record.
Provided that the outstanding amounts are paid there should be no problem in accessing a loan in the usual way, with a standard loan at the usual rates.
If the defaults were on a loan of any kind, or a credit card default, this has a stronger impact than unpaid telco and utility bills. The length of time between becoming aware of the default and paying the account is also measured, so it is best to pay immediately.
Hope this helps
Kristine
