When you are applying for home loans, the first thing the banks will see whether you have any pending loan for you or not and most importantly whether you have any bankrupt charges against you or not. If you are on a defaulter’s list then getting a bank loan will be difficult.
If you have faced bankruptcy charges earlier and has applied for a home loan soon after, then you need to get a discharged bankrupt certificate offered to you by the bank. What is that? A discharged bankruptcy means you have been cleared and released from bankruptcy status. If you don’t have this clearance, then applying for the credit and enjoying certain options may become limited for you. Bankruptcies charges in Melbourne usually last up to three years and can be extended considering certain conditions. Until and unless you are discharged, your credit report will be affected badly. You won’t be able to spend as much as you can, and the bank can possess and auction your property to clear the debt.
How to apply for a home loan after discharged bankruptcy?
Now the question remains whether or not you can apply for a discharged bankruptcy home loans like these. When you are discharged, lenders will willingly offer you home loans. But while you are applying for a home loan, make sure:
- That the lenders who are offering you loans not only offer loans to discharged bankrupts but also have a good reputation in this field.
- This will not only give your application a higher chance of approval, but the terms that will be offered are also fair.
- Never apply to more than one lender at a time and wait for a certain period after you have been rejected by one lender.
- Be ready to apply a higher interest rate, since there is risk attached to offering loans to one time bankrupts. So keep aside a large deposit
- Since you have been bankrupted once, and there is a high risk attached to you, they will naturally hesitate to give you a home loan. To win their confidence, you should have a history of loan repayment, employment track record, savings deposit of 20% or more and that the bankruptcy was unintentional.
- Make sure the solution is tailored to you by an specialist lender at acceptable level of risks
Different Home Loans available for discharged bankrupts
There are some home loans available for discharged bankrupts. They are:
- Basic Home Loans- This is the standard home loan available for those who are looking for loans within their budget. Although you won’t be approved by pre-purchase approval.
- Package Home Loans- This type of home loan comes with additional services of credit cards and transaction amounts.
- Low Doc Loans- If you cannot present any income certificate or proofs like tax returns etc, and then you can avail of this loan easily. You have to declare your annual income, but have to pay a higher interest rate. This kind of loan is ideal for self-employed people or freelancers.
Different lenders have different lending requirements, so speak to one in Melbourne before applying for home loans to come clear about your eligibility.