March 08 2022
When it comes to buying a home for the first time, it can be challenging to qualify for a mortgage with poor or no credit history. According to a 2017 Ipsos survey for Capital One, approximately 69% of Canadians are unaware of their current credit score and 40% of Canadians are hesitant to figure it out. While it's easier to get approved for a mortgage with a strong credit history, that doesn’t mean people with poor credit are automatically written off. Is it impossible to secure a mortgage with no credit history? The simple answer is no, however, we suggest taking the steps to build your credit to strengthen your chances of getting approved.
Let’s take a closer look at credit.
A person's credit history is a record of an individual's paid off debts and loans, including student loans, car loans, mortgages and credit cards. These factors can all impact your credit score.
A credit score is a number between 300 and 900, which is assigned to you based on your credit payback history, including credit cards, lines of credit and auto loans. It represents a judgement of the risk you pose to lenders at a specific point in time. Essentially, the higher your credit score the less risk you pose. Typically, a credit score of 650 and above is widely accepted by lenders and shows that your repayment history is strong.
How to improve your credit score
Building a great credit history is necessary and beneficial because lenders may want to know how reliable and financially responsible you are. These are some tips to help you approve your credit score.
How Homewise Can Help
Many financial institutions might turn down your mortgage applications due to your lack of credit history or poor credit score numbers. At Homewise, we can refer you to various lenders beyond the big banks like credit unions and monoline lenders who can help buyers with lower credit.
Our dedicated team of mortgage advisors are here to help you seek out all available and affordable options before making your final decision. All you have to do is apply online in just 5 minutes and one of our advisors will connect with you to start the process.
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