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picture of thoughtful focused young housewife stud 2021 08 31 06 09 27 utc 1 scaledMany people share the dream of owning their own home. But, for some, that dream feels out of reach. This may be an issue if you’ve had trouble with your credit score in the past. Don’t lose heart, there is hope. Though it is more difficult to secure a mortgage with adverse credit, it is not impossible. We are here to help you recognize your dream!

If your credit score is less than ideal, there are a few things to consider when you’re looking to buy a home. With a little knowledge and effort, you can put yourself in a better position for being approved.

Credit Score

It’s important that you know what your credit score is and understand the implications. It is based on the past 6 years, so, if you’ve had issues before that time, you have a fresh start. Lenders will take into consideration several factors: your score, outstanding debt, and time frame. If you’ve had bad credit in the past but have been working to improve it, that will be recognized. Adverse credit in the past 12 - 24 months will lessen your options and likely mean higher rates and a larger down payment.

Other Debt

If you have other debt, work at paying it off. Not only will this put you in a better financial situation but it will improve your credit score. Lenders will see you as a higher risk if you owe money to a number of lenders. To put your best foot forward, pay off all other debt. This may take some time so you’ll need to be patient. It will be worth it in the end.

Mortgage Broker

Working with a mortgage broker will give you access to subprime and private lenders. A broker will also understand the mortgage requirements and be able to make recommendations based on your particular situation. Their expertise can help you discover options you may not have realized otherwise.

Down Payment

It is always a good idea to save for a down payment. However, when your credit is poor, a larger down payment will be a necessity. Lenders will require a sizable down payment to offset the risk. Although it can seem like an unattainable goal, saving up 20% for your down payment will be a benefit to you. Not only will it help you secure a mortgage but the more you pay upfront, the less you’ll need to finance. That equates to smaller payments or a shorter term.

Stable Income

Lenders will also consider the stability of your income and the length of your employment history. Choosing to lend money to someone with a steady paycheck that has worked at the same company for 7 years is much different than lending money to someone with irregular work. Your employment history can really work in your favour. In addition, if you have a side hustle and can prove income from freelance work, that can also work to build your case.


If you’re concerned about being approved, you could consider having someone co-sign a mortgage with you. This person should have excellent credit which will be considered as part of the application. It is important for this person to understand the implications of co-signing a mortgage. In the event that you default on payments, they will be responsible for the entire amount of the loan. So, having a frank discussion about the agreement is imperative.

There is a bit of work to do but if owning your home is important to you, we can work with you to come up with a solution. The good news is, the longer you make payments on your mortgage, the better your credit will become. When it comes time to renew your mortgage you will be in a much better position. If you’re unsure of your credit rating and if you would be approved for a mortgage, book an appointment today. We can help you crunch the numbers and find an option that works for you.

Contact Akal Mortgages Today to get Bad credit mortgage in Toronto today. 

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  • Jas Bath

    The experience with AKAL Mortgages Inc. is great!!! I recently got approved for a business loan thought them and the agent that helped me with the process was outstanding. I am impressed with the convenience and very helpful service. I hear their agents on the radio all the time making consumer aware of the options available about mortgages and loans. And, they way they do, touch my heart. So honest and ethical.

  • Oli Rubion

    My wife and I visited AKAL mortgages Inc. due to their reputation in the market. We were attended in a timely fashion to discuss our mortgage and line of credit needs. We are so glad that we were provided with great options and solutions to choose from. We are very happy and satisfied from the services provided by AKAL mortgages Inc. We definitely recommend their services to our family and friends.


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