Partner has good credit and I have bad credit. Can we still get a mortgage?

Any general questions you might have in regards to loans and finance.
Tricia
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Joined: Wed Sep 18, 2019 7:16 pm

Partner has good credit and I have bad credit. Can we still get a mortgage?

Postby Tricia » Wed Sep 18, 2019 7:18 pm

My partner and I are looking to purchase our first home together. He has good credit history and has $25k saved, but I have a poor credit history with many enquiries and late payments on my car loan and credit cards over the last two years. I have saved up around $10,000. Partner has good credit but I have bad credit. Can we still get a mortgage?

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Otto Dargan
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Re: Partner has good credit and I have bad credit. Can we still get a mortgage?

Postby Otto Dargan » Wed Sep 18, 2019 7:35 pm

Hello Tricia. Welcome to the forums.

Thank you for reaching out to us.

Yes, you can still move forward with getting a home loan even when your partner has with bad credit.

However, if you have too many credit enquiries on your credit file, then you can be seen as a high-risk borrower.

In most cases, most major lenders prefer it if you have less than two enquiries over the last six months. There are some lenders who are stricter and will ask for explanations as to why the enquiry is on your credit file in the last two years.

The reason you provide to the lender is a determining factor on whether your home loan will be accepted or not.

Our mortgage brokers have worked at credit departments of many banks and specialist lenders so they understand exactly how lenders assess bad credit home loan applications like yours.

We work with specialist lenders who offer competitive bad credit home loans.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a home loan, even with bad credit.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Tricia
Posts: 3
Joined: Wed Sep 18, 2019 7:16 pm

Re: Partner has good credit and I have bad credit. Can we still get a mortgage?

Postby Tricia » Wed Sep 18, 2019 7:44 pm

So what are our options like since my credit enquiries might be a huge issue here? I was moving jobs and was not able to make repayments on time.

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Otto Dargan
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Posts: 7698
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Location: Sydney, Australia
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Re: Partner has good credit and I have bad credit. Can we still get a mortgage?

Postby Otto Dargan » Wed Sep 18, 2019 8:01 pm

Hi Tricia,

There are many options you can choose from when a partner has bad credit when you’re applying for a home loan:
  • Your husband could apply as the sole applicant but this would mean that only his income will be serviced and only his name will be on the property title.
  • A common debt reducer home loan (CDR) is where there is only one applicant but the CDR allows the use of reduced living expenses and shared debts for servicing the loan as long as the non-borrower can evidence self-supporting income.
  • Another option is to have two people on the property title and only your husband’s name on the mortgage, commonly known as one borrower, two owners.
  • You can opt to apply with lenders that accept deal with bad credit home loans. Depending on your situation and reasons for bad credit, you might have to pay higher interest rates.
  • If none of these options works for you, then you might wait for the credit file to be clear of any adverse listings and improve your credit score. In the meantime, you and your husband could work towards saving a larger deposit.
Cheers
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Tricia
Posts: 3
Joined: Wed Sep 18, 2019 7:16 pm

Re: Partner has good credit and I have bad credit. Can we still get a mortgage?

Postby Tricia » Wed Sep 18, 2019 8:14 pm

It’s good to know there are quite a lot of options available. Since we already have saved a deposit of $35,000, we can work towards saving a larger deposit. What are the best ways to improve my credit score?

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Otto Dargan
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Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: Partner has good credit and I have bad credit. Can we still get a mortgage?

Postby Otto Dargan » Wed Sep 18, 2019 8:26 pm

Hi Tricia,

Some other tips to improve your credit score are:
  • Do not overdraw your cheque account.
  • Pay all your bills on time.
  • Do not apply for a new credit card
  • Try your best to pay off your debts on time.
  • Pay any defaults on your credit file as soon as possible instead of waiting for them to be removed.
  • Don’t apply for loans that you don’t require as this would create an enquiry on your credit file.
  • Open a savings account and try to save as much as you can.
It takes time and a lot of effort for your credit score to improve. However, enquiries older than 12 months do not affect your credit score.

To see if your credit score has improved, you can get a free copy of your credit report once a year from three Credit Reporting Agencies.

Speak to our mortgage brokers and we can help you find a lender that is lenient towards your situation.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts


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