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New Brunswick was one of the first places in North America to be settled and in 1785, Saint John became the first incorporated city in the entire country of Canada. As you could imagine, New Brunswick is home to a lot of history and is a great place to live and start a family.
However, the first step to doing that is buying a home. And unless you have a few hundred thousand dollars sitting in your bank account, you will likely need to secure a mortgage from a lender to be able to afford a home in New Brunswick.
Click here to learn more about loans in New Brunswick.
Credit Score Required for a Mortgage in New Brunswick
When getting a loan of any kind (from a car loan to a mortgage) in New Brunswick, one of the most important factors in the quality of your loan is your credit score. Your credit score in Canada will range from 300-900 and it is a simple way for lenders to see how reliable and safe you are to lend to. The higher your score, the better interest rates you will likely get.
Want to know how lenders arrive at interest rates? Find out here.
However, what is the credit score that is required for a mortgage in New Brunswick and the rest of Canada? While each lender in New Brunswick will have their own rules, generally, anything over 650 is considered a good credit score and will show that you are a good candidate to get a loan. Some lenders in New Brunswick are willing to work with those who have lower scores, but the mortgages will often have higher interest rates and more strict terms.
Check out this infographic for more information on the cost of buying a house in Canada.
Alternatives to Mortgages in New Brunswick For Bad Credit Consumers
While there are mortgage options for those with bad credit, they may often come with tighter terms and higher interest rates. As a result, getting a mortgage in New Brunswick when you have bad credit is not always the best option. Thankfully, there are some things you can do.
If you do need a bad credit loan in New Brunswick, look here.
Get a Bridge Loan
A bridge loan is a very common and helpful option for those with less-than-perfect credit scores. It is a short term lending solution that is used to increase your credit and help you gain access to a more affordable mortgage or another loan in the future. While a bridge loan can come with a higher interest rate, you will only need to deal with this for a relatively short period of time while you work at building your credit.
Searching for short term loans in New Brunswick? Check this out.
Have a Cosigner
If you are unable to get a solid mortgage on your own, you should consider having a cosigner. Having a cosigner on your mortgage will give the lender peace of mind knowing that you have someone else who will be on the hook for your loan if you default. However, finding someone willing to be a cosigner for you might be relatively tough, so definitely don’t rely on it as your sole option.
Look at this if you’re wondering which types of lenders will accept a cosigner.
Wait Until You Have a Better Credit Score
If you can’t find a cosigner and don’t want to secure a bridge loan, you may be better off waiting until you have a better credit score and report before applying for a mortgage. While this isn’t always possible, waiting on a mortgage until you have a better credit score can help you save a good amount of money in the long run.
To discover some methods of improving or fixing your credit score, try reading this.
How To Build Your Credit So You Can Get Approved For a Mortgage in New Brunswick
So how can you go about building your credit up enough to get a quality mortgage in the future? Well, there are a few simple and easy things you can do to dramatically increase your credit score in a relatively short period of time. They include:
- Paying your bills on time every single month.
- Keeping your credit utilization rate low (around 30% should be the maximum)
- Use your credit, but don’t go overboard with it
- Become an authorized user on a friend or family members’ credit card. Even if you don’t use it, being an authorized user can help your credit score increase.
- Increase your limit and don’t close old credit accounts. If your available credit drops, it could look bad to the credit bureaus, which could lead to your credit dropping.
To see how the length of your credit history affects your credit score, click here.
Can I pay off my mortgage early?
How do I get a pre-approved mortgage in New Brunswick?
I have bad credit. Can I still qualify for a mortgage?
Finding the Perfect Mortgage in New Brunswick
If you are interested in securing a mortgage in New Brunswick, be sure to reach out to Loans Canada to help. We have years of experience helping people, all over the country, secure the perfect mortgage for their unique lifestyle.