

Relocation loans for bad credit: What are your options?
Moving home is stressful. And if you require finance to do so, but have a poor credit history, it can feel even harder. It’s natural to worry that your credit report might stand in the way of getting approved.
The good news is that help is available. Some lenders specialise in relocation loans for bad credit, and a broker can connect you with the right solution for your circumstances.
What is a ‘relocation loan’?
A relocation loan is usually just a standard home loan used when moving. While some banks offer specific relocation products, these are rare – and are typically unavailable to borrowers with bad credit.
If you’re relocating and need finance, you’ll most likely apply for a flexible home loan that suits your situation, rather than a dedicated relocation loan for bad credit.
Understanding bad credit and its impact on home loans
Bad credit can include missed payments, defaults, too many credit applications or bankruptcy. These issues raise red flags for lenders, who see them as risk indicators. This, in turn, can reduce your chances of loan approval, limit your borrowing power or result in higher interest rates.
You can check your own credit report through one of the major credit reporting agencies, such as Equifax, Illion or Experian.
Can you get a relocation loan with bad credit in Australia?
Yes, potentially. While major banks may decline your application, specialist lenders can take a more flexible approach. They consider your broader situation, including your income and how long ago your credit issues occurred.
Mortgage brokers from Loan Market Connect have experience in bad credit home loans and can help match you to the right lender.
Factors lenders consider for bad credit home loans
When assessing a loan application from someone with bad credit, lenders look at more than just your credit score. They consider how recent and severe your credit issues are, whether they were caused by a one-off event or an ongoing pattern, and how you've managed your finances since.
They’ll also weigh up your current financial position – including your income stability, employment history, deposit size and any existing debts. The stronger these areas are, the more likely a lender is to take a positive view of your application.
Strategies to improve your chances of approval
Getting approved with bad credit isn’t guaranteed, but there are clear steps you can take to improve your odds:
- Catch up on overdue payments: clearing any outstanding bills or defaults helps show lenders you’re back on track
- Lower your unsecured debt: credit cards and personal loans can weigh down your application, so reducing these can make a difference
- Build a savings history: regularly setting aside money, even in small amounts, shows discipline and financial recovery
- Stick with stable employment: lenders are more comfortable when they see consistent income over time
- Limit new credit enquiries: applying for multiple loans or credit cards in a short period can be a red flag
Taking even a few of these steps before applying can improve how lenders view your application – and show that you're in a stronger position now than when your credit issues occurred.
The role of a mortgage broker when you have bad credit
When you have bad credit, finding the right lender is crucial – and this is where a mortgage broker can really help.
A broker like Loan Market understands which lenders are open to bad credit applications and what those lenders need to see. We’ll guide you through the process, help you prepare a strong application and advocate on your behalf.
With access to a wider range of bad credit home loan lenders in Australia, we can connect you with lenders who are more likely to say ‘yes’.
FAQs about relocation loans for bad credit
What are the types of bad credit home loans?
In Australia, several types of loans are available for borrowers with bad credit, including:
- Non-conforming home loans
- Low doc loans
- Debt consolidation loans
- Guarantor loans
- Private or non-bank lender loans
- Specialist refinance loans
Which banks approve home loans with bad credit?
Most major banks do not. But some second-tier and non-bank lenders are more flexible in assessing bad credit applications. Loan Market can help you identify these lenders and match you with the ones most likely to approve your application.
Can I get a home loan with a default?
Yes – especially if it’s minor, paid off or from years ago.
How long does bad credit stay on your record?
Most credit issues, like missed payments or defaults, stay on your credit report for five years. More serious events, such as bankruptcy, may remain for longer, depending on the circumstances. Lenders will also look at how long ago the issues occurred and whether your financial habits have improved since then.
What’s the difference between a prime and a specialist lender?
Prime lenders, like the big banks, typically work with borrowers who have clean credit histories and stable finances. Specialist lenders are more flexible; they focus on understanding your current situation and may approve applications from people with past credit problems, irregular income or other complexities.
Do all banks offer relocation loans?
Not all banks offer relocation loans, and those that do often have strict lending criteria. For borrowers with bad credit, the options are even more limited. That’s why many people in this situation work with brokers to access more flexible loan products from second-tier or non-bank lenders.
Is it harder to get a loan for an existing home with bad credit?
Not necessarily. In fact, many lenders are more comfortable financing established homes than new builds or off-the-plan purchases. The key is to present a strong overall application and choose a property that aligns with the lender’s requirements.
Can I get a home loan with a 5% deposit if I have bad credit?
It’s possible, but it can be difficult. Most lenders prefer borrowers with bad credit to have a larger deposit, as it reduces their risk. However, if the rest of your application is strong, some lenders may still consider it.
Taking the next step towards your relocation
Relocating with bad credit might feel overwhelming, but options are available. With professional support and the right lender, finance may be within reach.
Feeling overwhelmed by your relocation and credit history? Don't navigate it alone. Talk with a Loan Market broker today to understand your options and take the next step towards your new home.
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