What credit score do I need after bankruptcy?

What Ontario borrowers should know

The best place to start is with the specific reason the application falls outside conventional lending guidelines. There is no single score that answers this for every lender; the credit history behind the score and the rest of the file matter. A targeted application is usually more effective than sending the same file to several lenders and hoping one uses a different rule.

A post-bankruptcy score has to be read with the history

From an underwriting perspective, a lender may want to see new credit accounts, clean payment behaviour, modest balances, and time since discharge rather than relying on the score alone.

Rebuilding should be controlled

For this particular question, a few well-managed accounts can be more persuasive than many new credit applications opened quickly.

Mortgage readiness also includes cash flow

What changes the answer is that stable income, a sensible down payment, manageable debt, and up-to-date tax filings help the credit recovery translate into mortgage options.

The cost question

A homeowner with post-bankruptcy equity may have alternative refinance options before qualifying at a major bank. The cost needs to be weighed against waiting and rebuilding longer.

Documents to have ready

• or request a current credit report and explanation for major negative items
• or request recent income documents and proof of employment or business activity
• or request statements showing down payment, home equity, or existing mortgage balances
• or request a list of monthly debts and any amounts that will be paid out at closing