Key takeaways
- Refinancing with bad credit is possible through specialist lenders with more flexible credit policies.
- Bad credit can include defaults, court judgments, missed payments or a bankruptcy history.
- Specialist lenders assess your situation case by case rather than declining automatically.
- Expect higher interest rates than prime lending, but a stronger equity position improves your chances.
If your credit has taken a hit, the big banks can feel like a closed door, and being knocked back stings. The good news is that a knockback from one lender is not the whole market. Andy has been broking since 2000, and he works with specialist lenders that most people never deal with directly, lenders who look at the person behind the file, not just the number.
What Counts as Bad Credit
Bad credit includes defaults, court judgments, missed payments or a bankruptcy history. Even a couple of missed repayments or a small default from years ago can show up. The important thing to know is that lenders treat different impairments differently, a single old default is a world away from a recent bankruptcy.
How Specialist Lenders See It
Specialist lenders assess credit impairments case by case rather than running an automatic decline. They want the story: what happened, when, and whether your situation has since stabilised. A medical event or a business that hit a rough patch, now behind you, is very different from a pattern of ongoing trouble.
The Trade-Off
Bad credit refinancing typically carries higher interest rates than prime lending, because the lender is taking on more risk. That is the trade-off. Often the play is to refinance now to get your situation under control, then revisit in a year or two once your credit has recovered and move to a sharper rate.
Why Equity Helps
A strong equity position improves your approval chances, because a lower loan-to-value ratio means less risk for the lender. If you have built up equity in your home, that can offset credit concerns and open up more options.
| Strengthens your application | Weakens it |
|---|---|
| More equity (lower LVR) | Very high loan-to-value ratio |
| Stable, recent income | Irregular or unverified income |
| Old, explained impairments | Recent or unexplained defaults |
| A clear plan to recover | Ongoing missed payments |
How Andy Helps
Andy accesses specialist lenders not available through direct bank applications, and he packages your application so the lender sees the full picture. He will be honest about the rate, give you a path back to mainstream lending, and answer his phone when you have questions. For more, see bad credit and non-conforming home loans and how your credit score affects your application.
The Next Step
Been knocked back elsewhere? It is worth a second opinion. See the refinancing page and get in touch.
Bad Credit Refinancing Questions
Can I refinance if I have a default on my file?
Often, yes. Specialist lenders assess defaults case by case, especially older ones that have been explained and paid. Andy can match you to the right lender.
Will I be stuck with a high rate forever?
Not usually. A common strategy is to refinance now, stabilise, then move back to a sharper rate once your credit recovers. Andy plans that path with you.
Does having more equity help?
Yes. A lower loan-to-value ratio reduces the lender’s risk and improves your approval chances even with credit impairments.
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