Having a bad credit rating or history can adversely effect your chances of loan approval with major conventional lenders although there are alternatives. If you are in a situation where you require finance whether it be to consolidate debts, refinance or mortgage loan with a bad credit history there may be options available via non-conforming lenders, low doc or no doc loans.

Non Conforming Lenders
Non Conforming lenders provide loans for those that may be outside of traditional bank lending criteria. Criteria will differ from lender to lender particularly for those with impaired credit history. With the lender taking more risk it is likely that the rates/fees may not be as competitive as a traditional loan and it is worth shopping around. Generally the higher the impairment and the higher the loan to value ratio (how much you are borrowing against asset valuation) the higher the rate. Non Conforming lenders/loans are often referred to as Sub Prime lenders/loans.

This type of lender may be suitable for those with bankruptcy issues, credit defaults, self employed, part time employed that are looking to refinance, finance or borrow.

There is now a growing number of non conforming lenders which include Liberty Financial, Pepper Home Loans, GE Mortgage Solutions (GE Money), Bluestone Mortgages and as they would check your history you should also check theirs. In regards to mortgage loans look for MIAA approval.

No Doc or Lo Doc Loans
This type of loan caters mainly for self-employed borrowers who are unable to provide full financial statements and other evidence of their income. The applicant self verifies there income. They may also be required to take out mortgage insurance. Generally a good credit history is required for this type of loan and lenders may also require more stringent property valuations, offer less features and charge higher interest rates although may offer reductions after a period of time when tax returns/statements can be produced.

Personal Finance
bad credit loans, poor credit loans