A number of people find themselves in a position where they need to get a loan even after they have gone through the consumer proposal. The best part is that you have made it through the consumer proposal, and now you have better control over your finances. Do not feel bad that you had to go through this because these processes were made for us to financially reestablish ourselves.
Now, the question is, can you qualify for mortgage loan in Canada after you have completed your consumer proposal?
During the consumer proposal, the bank will not lend you any money as you are already under debt. The individual has to wait for up to two years after the discharge to be regarded as a candidate for loan. This is because the bank has to make decisions in their interest and many times, people stop paying the consumer proposal amount and declare bankruptcy in the middle of the process.
The bank will decide if you are eligible for mortgage after consumer proposal or not. This judgment is made on the following criteria.
a. Low Debt Income Ratio
Your debt income needs to be low, if you have not developed a balance on credit cards after the proposal is complete. You will be at risk because you will be in debt of more money than you are earning.
b. Stable Job
Second thing that the bank will take into consideration is how stable your job is. Your income and the length of your employment will also be verified. If you do not have a stable job, or a steady source of income, then you will have hard time convincing the lenders to provide you with the money.
c. Credit Score
Lastly, your credit score will be examined, which has the power to either grant you with mortgage or not. If you are applying for mortgage just after completing your consumer proposal, your credit score will be low. Therefore, you need to acquire strategies to boost your credit score and credit rating.
Moreover, after you have completed the consumer proposal, you can wait for some additional time and then apply for the mortgage. During that time, you can work on enhancing the credit rating because you will only get the bank’s approval if your credit score is good enough. This is the most important criteria out of the three. Individuals who are not able to meet this criterion will not get the mortgage loan even if they meet the other two conditions.
People can also carry out a credit check on themselves before they make an application on their mortgage approval. The credit bureau should include the right date of the completion of consumer proposal, and the creditor of the consumer proposal must be shown inactive. This way, you will correct the blunders before filing the mortgage application.
You can also take the help of a counselor to guide you regarding mortgage and your eligibility. Even if you do not qualify now, you will be provided with directions that will facilitate you in the future.