How Much Can I Borrow in Simple Terms? 

You can borrow money for a home loan, even if you had problems with paying debts before. 

• You may get up to 95% of the property value from special lenders who accept defaults. 
• Some banks might give you up to 90%, but they have strict rules. 

Will I Get Approved? 

To make it more likely for the bank to say yes: 

• Explain why you had problems (defaults). 
• Show proof that your explanation is true. 
• Save at least 5% of the home’s price as a deposit. 

Which Lenders Can Help? 

Special lenders and some big banks might help.  

What’s a Default on Your Credit File? 

A default is like a mark on your record, showing you didn’t pay a bill on time. It stays for 5 years on your credit file. 

• If you apply for a loan, lenders will see this record. 
• You can’t hide it from them. 

Requirements for Home Loan Approval 

Banks look at different things about your defaults: 

If you’re borrowing more than 80%, make sure your defaults are under $500. For borrowing up to 80%, keep defaults below $1,000. Don’t exceed two defaults for one application. Pay off defaults at least six months before applying. Have a minimum of 5% genuine savings for property purchase. Ensure all other non-default requirements are met, and provide a credible reason for your credit history issues.  

 Meeting these requirements doesn’t guarantee loan approval, but it significantly boosts your chances. 

If Big Banks Say No, Specialist Lenders Can Help 

Specialist lenders are like experts who might say yes, even if big banks say no. You can refinance later for a better deal. 

What Will Lenders Know? 

Lenders see if your defaults are paid, unpaid, or settled. They know when it happened, how much, and who did it. A settled default is better than unpaid. 

• They check if you ignored your responsibilities or avoided lenders. 

How to Apply for a Home Loan with Defaults 

• Explain why you had defaults. 
• Show proof it won’t happen again. 
• Save at least 5% as a deposit. 
• Pay unpaid defaults and show they are paid. 
• Apply with a lender who is okay with defaults.