How to get a Home Loan with Poor Credit

If you’ve had a few credit defaults, don’t lose hope - lenders like Bluestone do away with credit scores and take the time to understand your needs, so we can find a solution that’s right for you.

If you’ve had a few credit hiccups and defaults, the thought of applying for a home loan can make you feel nervous. Unexpected life events can mean there are many reasons why you may have missed a utility bill or fallen behind on your credit card payments. But the automated credit scoring methods undertaken by most mainstream lenders may result in your application being declined.

With the support of the right people, and an achievable plan for meeting your financial obligations, it’s likely that you will be able to move back onto solid ground.

Review your situation

Take a good look at your outgoings. What is stopping you paying your bills?

Maybe high interest personal loans or spending on credit cards are the cause? Or, perhaps you’ve only recently fallen into hardship and now want to cash out the equity you’ve built in your existing home loan to pay off creditors.

Whatever the reason, when you have a credit report that’s impacted by defaults it’s a good idea to be clear about what you want to achieve and what debts you need to pay off before applying for any new loan. Remember in most instances, a new credit check can impact your credit score.

If you are unsure about the best way forward, there are free resources available to help you. You can call the free* National Debt Hotline on 1800 007 007 (Monday to Friday, 9:30am to 4.30pm). Also explore ASIC’s MoneySmart website, which can point you to further free financial counselling and legal advice services.

Find a non-bank lender who can help

Non-banks and specialist lenders like Bluestone offer loan solutions specifically designed to assist borrowers with impacted credit histories. In fact, since 2000 Bluestone has been able to assist nearly 60,000 people, many of whom have experienced credit issues prior to coming to us.

Unlike banks, we don’t use automatic credit scoring.  All our loan applications are assessed by real people. We take the time to get an accurate idea of your history, needs and goals.

You may be surprised that when it comes to defaults, writs and judgements, we ignore everything under $1000 or more than 2 years old. In addition, debts over $1,000, and even ongoing Part IV or X debt agreements and discharged bankruptcies, don’t automatically disqualify you for a Bluestone home loan. That means that even if you have a few marks on  your report, it’s possible we’ll be able to help.

Next Steps

We’ve added a couple of useful links to the end of this article that can help you prepare for your debt consolidation loan. Take a look at them, and once you’re ready take a look here to find out more about Bluestone’s specific product offerings.

If you’d rather have a confidential chat, Bluestone offers a convenient phone-based service for all loan enquiries. To fully understand the ways we might be able to help you, reach out to one of our home lending specialists by calling 1300 608 658 or by requesting a quote here (don’t worry - we won’t check your credit until you give the go-ahead).

Useful Links

National Debt Hotline

Money Smart’s Budget Planner


The information provided in this article is general in nature and should not be taken as constituting professional advice.  Because we do not know your individual financial circumstances it’s a good idea to talk to an accountant or financial adviser before taking out a loan.


*Fees may apply when calling from mobile phones
^Subject to credit assessment.