Best 5 Australian Lenders For Bad Credit | Home Loan Experts

Bad Credit Home Loans: Compare Top Lenders

Having a bad credit score doesn’t mean you can’t buy a home, but you’ll probably have to look a little harder to find a lender that can meet your needs.

This is where Home Loan Experts can help. We have lenders on our panel known for considering borrowers despite a bad credit rating. Let’s take a closer look at some of the best.

Top 5 Lenders Specialising In Bad Credit Home Loans

Home Loan Experts’ list of the best bad credit home loan lenders takes into account flexibility of eligibility requirements, interest rates, terms and loan features. Based on these criteria, these are the top five lenders in Australia for bad credit, as judged by our specialist lenders and in no particular order:

1. Pepper Money


Pepper Money pays special attention to borrowers with a bad credit history or to those who cannot prove their income. Their efficient service and fair pricing enables borrowers to buy a home or refinance their current home loan even after they’ve been declined by several other lenders.


  • Beating the other specialist lenders on interest rates and fees
  • Special solutions for borrowers with bad credit history
  • Fast loan approvals


  • Higher interest rates than the major banks
  • They’re less likely to help with remote or large properties
  • Fixed rates unavailable

Home Loan Experts Rating: 5/5

2. Resimac


Resimac is popular for dealing with bad credit home loans and having unique lending policies. Resimac Specialist is a loan product for borrowers with impaired credit. This loan product doesn’t have a limit on the number of debts that can be consolidated.


  • No credit scoring
  • Interest rate is based on security and not the purpose of the loan
  • Solutions for borrowers with a bad credit history


  • Relatively strict lending policy
  • Interest rates and fees are not always competitive
  • Slow to assess your application during busy periods

Home Loan Experts Rating: 3.5/5

3. Bluestone Mortgages


Bluestone’s Specialist + loan is crafted for borrowers who have had credit issues, such as bankruptcy and other defaults.

Under this loan type, they categorise a borrower’s credit history namely Clear, AAA, AA, A or BBB depending on the number of defaults, recently missed mortgage payments and if they have a history of bankruptcy or part 9 agreements.

A borrower that is categorised as Clear (highest category) will get a better interest rate than one categorised as BBB (lowest category). Being in a lower category also means a borrower will need a larger deposit.


  • Assessing loans using common sense instead of credit scoring
  • Special solutions for borrowers with a bad credit history
  • Accepts most unusual income types at 100%, but bonus income is shaded


  • Much higher rates and fees than a major bank
  • LVR restrictions for non-metro locations
  • Won’t do land and construction loans

Home Loan Experts Rating: 4/5

4. La Trobe Financial


Specialising in home loans for borrowers with a bad credit history, La Trobe’s bad credit commercial loans and low-doc commercial loans often have high rates but provide borrowers with options that often aren’t available from other lenders.


  • Specially curated solutions for borrowers with bad credit history
  • Decent cashout policy
  • Assessing loans using common sense instead of credit scoring


  • Maximum LVR is 80% of the property value
  • Risk fee, similar to Lenders Mortgage Insurance, can be expensive
  • Interest rates and fees are not always competitive compared with other specialist lenders

Home Loan Experts Rating: 4/5

5. Liberty Financial


Liberty’s specialist lending is great for borrowers looking to rectify their history of bad credit. On the other hand, as with any specialist lender, if a borrower misses payments on their home loan, Liberty will repossess the related property faster than any bank.



  • Among the most expensive LMI on the market
  • Uncertainty on loan approval
  • Often don’t stick with the rates promised during application

Home Loan Experts Rating: 4/5

How To Choose The Best Bad Credit Lender For Your Situation?

There’s no single ideal lender for every situation. Which one is right for you depends on a few factors:

  • Eligibility requirements: Lenders have their own eligibility requirements, including minimum credit scores, minimum income levels and maximum debt-to-income ratios.
  • Interest rates and fees: Different lenders use different criteria to calculate the interest rate for your home loan. We recommend getting quotes from a few lenders to compare interest rates, fees and prepayment penalties to figure out which will be the cheapest option for you.
  • Repayment terms: The repayment terms a lender offers make a huge difference. A longer repayment period will reduce your monthly bill. On the other hand, a shorter term means that you’ll be out of debt sooner and will have to pay less overall in interest.
  • Type of lender: Your most suitable lender could be a bank, credit union or online lender. While online lenders often have low rates, absence of in-person service might not work for you. Additionally, your existing lender may be more willing to extend you a home loan even with bad credit, based on your existing relationship.

Our Mortgage Brokers Can Help

Buying a home with bad credit might seem intimidating but our Home Loan Experts are specialists at them.

Our brokers will analyse your financial situation and your credit history to ensure smoothness throughout your home loan journey.

Home Loan Experts can help you reach your goal. Talk to our specialists on 1300 889 743 or fill in our free online enquiry form.

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