Even with a bad credit history, you can still buy a house.
Everyone dreams of owning a home someday. However, because houses are high-value assets, owning one requires a strong financial standing to secure a loan from a bank. Many people have a "credit bureau" record, leading to repeated loan rejections. However, even with a bad credit history, it's still possible to buy a home if you understand what a credit bureau record is and know the possible pathways for obtaining a home loan, especially for those with financial difficulties.
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What is a "credit bureau record"?
A "credit bureau record" indicates a person's problematic financial status. This is assessed based on spending habits, purchases, and installment payments recorded by the "Credit Bureau" or "National Credit Information Company Limited." If you have poor spending habits, such as missing payments or having large outstanding balances, this information is used by banks to assess your financial instability, low repayment capacity, and lack of financial discipline, leading to loan rejections.
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Even with a bad credit history, you can still buy a house.
If you know the right approach.
Credit bureau reports indicate everyone's financial status, whether good or bad, and assesses our ability to purchase or repay goods. Therefore, if your bad credit history prevents you from getting a home loan, you need to find other ways to convince the bank of your ability to repay. Currently, there are several ways to do this, as follows:
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1. Improve your credit history.
This is the most effective and beneficial method. Since the problem lies in debt, it's necessary to eliminate existing debt first, restoring your credit history to a normal status. Then, gradually build a good financial credit history to impress the bank, such as making timely payments, having no outstanding debts, etc. If you do this, your chances of getting a home loan approved will increase. However, improving your blacklisted credit history requires strong determination. This means improving your financial discipline, prioritizing all your debts, clearing them one by one, and paying off high-interest debts as quickly as possible. 1. Negotiate a debt restructuring plan with the bank to make managing your debt easier. It's also essential to increase your income and maintain strict saving discipline to clear your debt as quickly and efficiently as possible.
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2. Co-borrow with a family member who has a clear credit history.
Co-borrowing is another option that increases your chances of securing a home loan. It leverages the co-borrower's good credit and financial standing as evidence to build credibility with the bank. Ideally, the co-borrower should be a family member with a clean financial history and stable financial status. However, improving your credit history and demonstrating good financial discipline will further enhance your chances of approval.
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3. Buy through a real estate agent.
This is another option for those with a negative credit history, involving purchasing through a real estate agent. These agents can help with debt settlement and the loan application process. However, there are conditions to consider, such as purchasing a property selected by the agent. Some agents may charge fees for debt settlement, processing, and commissions. You should carefully research and compare the terms and conditions to ensure they suit your financial situation.
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4. Buying a House in the One Million Houses Project
The One Million Houses Project is a program by the Government Housing Bank (GHB) that offers low-income individuals across Thailand the opportunity to apply for low-interest home loans. It confirms that even those with a negative credit history can apply, as the bank will consider each individual's ability to repay and loan history.
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Credit history, or our financial status, is crucial for loan approval. Therefore, prioritizing improving and maintaining a good credit score, avoiding blacklists, and avoiding negative credit records is urgent if you want to buy a house. While there are other options available even with a negative credit history, such as joint loans, using real estate agents, and purchasing a house in the One Million Houses Project, ultimately, if you don't improve your spending habits, saving habits, and financial management, you risk defaulting on payments and facing the worst-case scenario of losing your home.
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Thank you for the valuable information from REIC.
