Vicky McLoughlin No Comments

Your finances can get a bit out of control sometimes for all sorts of reasons. Whether it’s through illness, divorce, redundancy, or sometimes just getting overwhelmed with things to do and accidentally missing a bill payment. The end result can be that you get put in the bad credit basket. Even if you sort it out and pay the overdue bills or fix up a default on a loan repayment, it can still end up on your credit file. (a record of your credit history maintained by credit reporting agencies like Equifax)


What is bad credit?

Bad credit is when you have a history of not keeping up with some payments and the result is that you’re not easily able to get approval for any new loans or credit. The reason many lenders will now steer away from you is because they see you as a high risk. The bottom line is that they’re concerned about your ability to make the regular repayments on their loan, if you’ve missed regular payments on other loans in the past.


How did I end up with a bad credit report?

There are several things that can leave you with a bad credit record:

  • Having unpaid bills or loan payments – such as utility or phone bills, personal loans or credit card repayments
  • Going over your credit card limit
  • Having been declared bankrupt in the past
  • A divorce leaving you in debt
  • Registered credit defaults against your name
  • A part 9 or 10 Debt Agreement
  • Having time off work with no pay because you were ill
  • Your credit file having ‘too many’ credit checks run on it by potential lenders.


How can I find out if I have a bad credit record?

Most times you wouldn’t really know. It’s not until you apply for a loan that you find out. If you do not fit the lender’s ‘lending rules’ they will label you non-conforming. It doesn’t matter if the credit issues were large, small, or even accidental, in the lender’s eyes, the fact that you missed payments has made you a candidate that is now too high-risk.

For your convenience, you can check your credit report here.


Am I still able to get a mortgage?

Major banks and lenders are likely to decline your application but the good news is that there are more lenders than the major banks out there and they understand that circumstances beyond your control can sometimes lead to a missed payment, default or even bankruptcy. They will look at each case on an individual basis to learn more about what happened and then look at how they might be able to work towards a solution for you.


What can I do now?

You can’t change what has happened in the past but you can change future bad credit listings. This will help to put you in a better position with lenders, as they’ll see that you are making an effort to fix your past financial problems. Here are some of the ways to do this:

  • Make repayments on time
  • Pay some part of your debts – don’t pay nothing
  • Pay off your existing defaults
  • Keep in contact with your lenders
  • Check your credit report at least every two years, this will help you to quickly fix any errors that have been unwittingly made.


If you’d like more information on how to get a home loan if you’ve had bad credit, contact us today. We work with the banks and specialist lenders every day, so we understand what they want to see when assessing a borrower’s ability to pay their monthly home loan repayments. We may be able to find you a lender that understands that you’re just looking for a second chance.


If you’re experiencing financial stress, you can always seek free financial counselling from the National Debt Helpline by calling 1800 007 007. Also, make sure you contact your bank as they can often assist to help get you back on your feet sooner.










The above information is general in nature. It has been prepared without taking into account your objectives, financial situation or needs.

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