Are you a non-conforming borrower?
Adelaide finance broker Dom Cassisi explains what it means to be a non-conforming borrower and what you can do if this describes you.
What is a non-conforming borrower?
Mainstream lenders and banks have very strict criteria for their potential borrowers. This criteria has unfortunately limited loan access to a large portion of would-be borrowers.
In fact, and estimated 25% of borrowers would fit into the category of being ‘non-conforming’, meaning that they don’t fit the lender’s definition of the ideal applicant.
A mismatch for credit guidelines doesn’t just mean that someone has bad credit. Non-conforming borrowers are also those who are:
– Near or past retirement age
– New Aussie residents
– New business owners
– Often changing jobs
– Not earning a lot of income
– Only able to afford a small deposit
Clearly, for a variety of circumstances, anyone could be a non-conforming borrower. It can be difficult to secure a loan in the face of a situation you have no control over.
Help for non-conforming loan applicants
There are loans that can specifically help non-conforming loan applicants. You’re likely to find that these come with a much higher interest rate and fees for things such as early repayment and exit.
However, these loans are very flexible and likely to be your only chance at securing any help.
You can improve your chances of being approved for a loan by:
– Cleaning up your credit report as much as you can
– Reversing any bad habit of making late payments (common with non-conforming borrowers)
– Carefully shopping around various lenders before filling out an application to keep your credit history clean
It’s worth noting that honesty is key. Be extremely transparent with a potential lender when it comes to your credit history and circumstances. It does not help your case to hide anything and give the lender a reason to be suspicious of you.
Are you overwhelmed at the thought of what to do next?
It’s easy to waste money and splash more mud on your credit history by making more failed attempts at securing a loan.
Save yourself time, headache and money by seeking professional advice. Funding Options is ready to take your call and help you uncover more options if you find yourself falling into the ‘non-conforming’ borrower category.
– Dom Cassisi, Managing Director