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Bad Credit Mortgage Broker

A credit score is a quick reference for lenders to assess your reliability and consistency in repaying debts and loans. This score determines your eligibility for a conventional mortgage or whether you'll need to resort to a bad credit mortgage. Young individuals and newcomers often face challenges due to their limited credit history. However, even with a low credit score, purchasing a home remains possible through bad credit mortgage options.
In Canada, credit scores range between 300 and 900, with higher scores indicating better creditworthiness. Should your credit score fall below 700 and you're in the market for home financing, exploring bad credit mortgage options might be worthwhile. This exploration can include both prime lenders, such as banks, and specialist lenders or trust companies that cater specifically to individuals with less-than-ideal credit.

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    A bad credit mortgage offers individuals with suboptimal credit scores a pathway to financing their home purchase. Lenders use credit scores, ranging in Canada from 300 to 900, to gauge the risk associated with offering you their services—the higher your score, the better your credit standing. Your credit score and history develop through consistent, reliable repayment of debts, including student and car loans and credit card bills.

    You may qualify for a poor credit mortgage even with a score lower than the preferred threshold. Such a score often reflects past financial struggles, like bankruptcy or loan repayment challenges. We are an experienced bad credit mortgage broker, specializing in assisting individuals with bad credit to secure mortgages, offering hope and solutions to those who might otherwise struggle to obtain home financing.

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    Prime Lenders: Prime lenders maintain the most stringent criteria for bad credit mortgages, yet often provide the most favorable rates. These lenders include the traditional financial institutions that typically come to mind for a mortgage application, including major banks. Although they generally favor applicants with high credit scores, it’s possible to secure a bad credit mortgage through them with a credit score of at least 600.

    Trust Companies and Bad Credit Lenders: Specialized financial institutions, such as trust companies, focus on serving individuals with poor credit scores or histories by offering bad credit mortgages. Generally, these lenders cater to clients with credit scores of 700 or below, and they can potentially secure a mortgage for those with scores as low as 550. 

    Private Lenders: These lenders may be either individual entities or private mortgage companies ready to offer mortgages to individuals with poor credit scores or histories. Certain private lenders may restrict their loans to financing only the down payment on a mortgage. Although their interest rates are significantly higher than those of prime lenders or trust companies, private bad credit mortgage lenders are a viable alternative for individuals whose credit scores fall below 600.

    Mortgage Squad Inc. is a beacon of hope for individuals battling bad credit. By facilitating access to diverse lending sources, from prime lenders to private entities, we help our clients significantly enhance their chances of securing a mortgage. Understanding that each client’s situation is unique, we personalize our approach, ensuring that each individual is matched with a lending solution that best suits their financial circumstances and home ownership goals, including a second mortgage.

    If you’re considering applying for a mortgage with a poor credit score, there are several important factors to keep in mind. During the application process, lenders will scrutinize various aspects, but they will primarily concentrate on:

    Credit Score and Debt History: A credit score and your debt or credit history provide a quick snapshot of your risk profile for a lender. Your credit score will determine whether you are eligible for a regular mortgage or will have to finance your home purchase with a bad credit mortgage. Credit scores in Canada range from 300 to 900, with a higher score being better. If your score is lower than 700 or you have a history of missed payments, you may have to opt for a bad credit mortgage. 

    Income and Employment History: A lender’s primary concern is whether you will be able to repay the loan reliably over time. As such, they will look at your income and employment history when you apply for a mortgage. If your credit is below ideal and you have a low income or an employment history that is difficult to verify, then you may be required to apply for a bad credit mortgage. 

    Property: Any time you apply for a mortgage, the lender will want to look at the property. They will look at the state of the construction and required maintenance costs of the property, the area it is in, and if they consider it affordable for you. If you are applying for a bad credit mortgage, the bad credit mortgage lender may be stricter with the type of property they are willing to finance.

    Down Payment: In Canada, the minimum down payment on a property is 5%, with that amount rising to 10% of a property that is valued over $500,000.

    At Mortgage Squad, we specialize in helping individuals with less-than-perfect credit secure their dream homes. With over 15 years of experience, we are known as a leading bad credit mortgage broker with an expertise in navigating through the complexities of bad credit mortgages. We understand the anxiety and uncertainty that comes with the fear of mortgage denial. That’s why our approach is focused on preparing our clients for success right from the start. Our comprehensive pre-approval services and robust application support are designed to present your case in the best possible light. Trust us to guide you through every step of securing a mortgage, even when your credit score isn’t ideal. Whether you need a second home mortgage or require assistance with mortgage renewal, we are here for you.

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    Win A Free Mortgage Payment

    Register your mortgage renewal date with Mortgagesquad.ca and you could WIN your first month's mortgage payment upon renewal (see terms and conditions). When you register your renewal date with us, you secure the lowest interest rate possible up to four months before your mortgage is due. So, if rates go up prior to your mortgage renewal, you can still get the lower rate. If rates go down, you will still get the lower rate… it is a WIN FOR YOU.

    Tips for Getting a Bad Credit Mortgage

    Because the burden to prove eligibility is greater on self-employed individuals, it pays to be well prepared before applying for a loan. The following should be considered before going into apply for a Self-Employed Mortgage:

    Improve your credit score

    Improving your score can help make you eligible for a bad credit mortgage and may get you a lower mortgage rate. Paying bills and loans on time, paying down debt, and keeping your debt at a manageable level can help improve your credit score.

    Put down a larger down payment

    When applying for a bad credit mortgage a larger down payment is beneficial. It reduces the risk for the lender and can lower your mortgage rate. A down payment greater than 20% can free you from being required to purchase mortgage default insurance.

     

    Consider a joint mortgage or a co-signer

    When applying for a bad credit mortgage it can be easier to make a joint purchase with someone you trust, often a family member like a parent. This can reduce the risk for the lender and may get you a better mortgage rate. The co-signer and you will share the ownership of the property and the risk.

    Find the best lender for you

    Different lenders will have different risk allowances and requirements. The right lender can get you a better mortgage rate and can be the difference between getting a bad credit mortgage and not getting one, so shopping around is to your benefit. Choosing us as your bad credit mortgage broker provides the unique advantage of accessing a wide network of lenders, ensuring you find the one that best suits your financial situation and goals.

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    Commonly Asked Questions

    If you have a bad credit score it is still possible to get a mortgage. If a prime lender like a bank is not willing to finance you there are trust companies and bad credit lenders who specialize in providing bad credit mortgages, in addition to the option of private lenders.
     
    If you are applying for a bad credit mortgage your mortgage rate will be higher than a typical mortgage. The mortgage rate can range from above 5%, and in some cases even above 10%, and will depend on the lender and your credit score, income, down payment, and the property.
     
    Improving your credit score for a bad credit mortgage will involve being consistent and reliable at paying back your debts and loans. Paying bills on time, keeping up payments on your loans, and paying off your credit card each month will help raise your credit score. Debt consolidation can also be an option if you are struggling with debt management.

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