Home Loans For Discharged Bankrupts

A bankruptcy can stay on your credit file for 5 years after you're discharged, but you can still get a home loan.

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Most lenders won't consider a mortgage application from someone who has experienced bankruptcy, even if you've been discharged from the bankruptcy.

But there are specialist bad credit lenders who can help. Compare loans in the table below or read on to learn more about finding a mortgage as a discharged bankrupt.

Discharged bankrupt? You could be eligible for one of these loans

Rates last updated February 26th, 2020
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Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
Pepper Money Easy Near Prime Full Doc Home Loan - LVR >55% to 65%
$15 monthly ($180 p.a.)
Available for former bad credit borrowers who have had a clean credit file for the last 24 months. Available for purchase or refinance.
Aussie Activate Specialist Alt Doc Home Loan - >55% up to 65% LVR Standard Rate
$15 p.a.
Pepper Money Advantage Specialist Full Doc Home Loan - Standard LVR 55%
$15 monthly ($180 p.a.)
Available for borrowers with bad credit history. Can be used for purchase or refinance even with negative listings on your credit file.

Compare up to 4 providers

Can I get a mortgage after my bankruptcy ends?

You can get an apply for a mortgage from the first day your bankruptcy ends. But keep in mind that your bankruptcy remains on your credit report:

  • For 5 years from the start of your bankruptcy
  • Or 2 years after your bankruptcy ends (whichever is later)

Unfortunately, your credit file doesn't list the reasons behind your bankruptcy, meaning you could find it very difficult to get any sort of home loan even once you're discharged. Because these listings stay on your credit file for seven years, this can put your dreams of owning a home on hold.

That's why finding a specialist lender is a really good idea.

Specialist lenders for borrowers with credit problems

Home loans for discharged bankruptcies featureSome Australian lenders specialising in lending to people with troubled credit histories include:

  • Pepper Money
  • Savvy
  • Red Rock Mortgages
  • Liberty

Mortgage brokers can help too

Qualified mortgage brokers can help you find appropriate bad credit mortgages. They specialise in helping borrowers in unique circumstances and also help you craft the best possible mortgage application. This increases your chance of success and reduces the chance of your application being rejected, which can have a negative impact on your credit report.

How do I apply for a home loan as a discharged bankrupt?

It always helps to have a strong mortgage application. Here are some tips to strengthen your application even as a discharged bankrupt:

How can I improve my credit report?

Here are some useful guides to improving your credit report.:

Check your credit score for free right now

Are mortgages for discharged bankrupts different to regular home loans?

A home loan from a specialist bad credit lender serves the same basic purpose as any other mortgage: it lets you borrow money to buy a property.

But there are some differences too:

  • Higher interest rates. Your loan will likely have a significantly higher interest rate. But it still pays to compare and get the best possible deal.
  • A higher loan-to-value-ratio (LVR). Regular mortgages usually require a 20% deposit (meaning an LVR of 80%) or even just a 5% deposit. A bad credit loan may only lend you between 55% and 70% of a property's value, meaning you will need a larger deposit. But this isn't always the case.
  • More fees. Most mortgages come with fees, but bad credit loans for discharged bankrupts typically charge higher fees. This includes application fees and ongoing monthly fees.

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15 Responses

  1. Default Gravatar
    SueFebruary 20, 2017

    We have been discharged for more than 7 yrs… we asked accountant and an mortgage agent for help which means they applied for short term loan for deposit as we rent and have kids at private school- acquiring savings beyond us, but a mortgage wld be less our rent! Resulting in us having multiple applications that have been declined. My husband is on more than 100k and I’m in high 70s… how can we clear the non Approved applications off our rating to improve chance of getting personal loan and eventually home loan

    • Avatarfinder Customer Care
      MayFebruary 24, 2017Staff

      Hi Sue,

      Thank you for your question and for contacting finder.com.au – we are a financial comparison website and general information service designed to help consumers make better decisions. Please note that we are not affiliated with any company we feature on our site.

      Basically, when you apply for any form of credit, the lenders you’re applying with will most likely make an enquiry on your file. So when you have several enquiries on your file due to many credit applications in just a short period of time, this negatively impacts your rating and thus makes you less likely to get approved for a credit. Unfortunately, legitimate enquiries cannot be removed from your file, unless the lender made an enquiry without proper authorisation from you. On this article, you would find tips on how you’d be able to improve your credit score.

      Nevertheless, if you are looking for a lender who might approve you for a personal loan, you may check this page for your options. Please note though that your approval may still be on a case by case basis so it’s important that you read the criteria, relevant PDS/T&Cs of the loan and discuss your eligibility directly with the lender.


  2. Default Gravatar
    GraceSeptember 16, 2016

    Hi. I am applying for a surname change and one of the questions is about bankruptcy. How can I find out the discharge date of my bankruptcy and how can I get a copy of the letter of discharge?

    • Default Gravatar
      JodieSeptember 16, 2016

      Hi Grace,

      Thank you for contacting finder.com.au we are a financial comparison service and are not qualified financial experts.

      According to the Australian Financial Security Authority website your bankruptcy discharge should be recorded on the National Personal Insolvency Index that you can search to find the details of. The Australian Financial Security Authority will have some information on how to get a copy of your letter of discharge as well.


  3. Default Gravatar
    GraceSeptember 15, 2016

    Hi. I’m applying to have my surname changed and one of the questions is about bankruptcy. How can I find out the date my bankruptcy ended?

    • Default Gravatar
      JodieSeptember 16, 2016

      Hi Grace,

      Thank you for contacting finder.com.au we are a financial comparison service and are not qualified financial experts.

      According to the Australian Financial Security Authority website your bankruptcy discharge should be recorded on the National Personal Insolvency Index that you can search to find the details of.


    • Default Gravatar
      GraceSeptember 16, 2016

      Hi Jodie. I went on that site but it costs to find out….

    • Default Gravatar
      JodieSeptember 16, 2016

      Hi Grace,

      Unfortunately I don’t know of any other service that allows you to get the documentation without a fee, you would need to speak to an accountant or financial advisor.


  4. Default Gravatar
    NicNovember 12, 2015

    Im a discharged bankrupt for more than 7 years. I have not tried to get any credit in this time. Will my history still effect my chances of getting a loan.

    • Avatarfinder Customer Care
      BelindaNovember 13, 2015Staff

      Hi Nic,

      Thanks for your enquiry.

      Although bankruptcy can remain on your credit file for up to 7 years, there are numerous specialist brokers and lenders that are willing to offer home loans to discharged bankrupts.

      Keep in mind that lenders generally charge a higher interest rate with these loans compared to standard home loans as a precautionary measure.

      Above on this page, you can compare these lenders on this page and click on the ‘enquire’ button to be redirected to their website for further details.


  5. Default Gravatar
    AmyJune 17, 2015

    I am going bankrupt and my plan is that once i am discharged to look at purchasing a house where do i stand and what do i do?

    • Avatarfinder Customer Care
      BelindaJune 17, 2015Staff

      Hi Amy,

      Thanks for your enquiry.

      On this page, you’ll find a list of lenders listed above that offer home loans for discharged bankrupts. Your best course of action would be to contact one of these lenders to discuss your options.

      You might also be interested to learn more about how you can get approved for a home loan with bad credit on this page.

      Kind regards,

  6. Default Gravatar
    NickAugust 14, 2014

    If I’m co-borrowing with someone who isn’t an ex-bankrupt, does this make a difference to your lending options?

    • Avatarfinder Customer Care
      ShirleyAugust 18, 2014Staff

      Hi Nick,

      Thanks for your question.

      It does widen your lending options a bit, as the lender will consider the combined credit histories of both applicants.

      Having said that, it might not widen your options a whole lot, especially if the bankruptcy occurred less than seven years ago.

      If you’d like, you may want to consider a mortgage broker who can help find a home loan for your situation.

      All the best,

    • Avatarfinder Customer Care
      MarcAugust 18, 2014Staff

      Hi Nick,
      thanks for the question.

      When co-borrowing with someone, both of your credit histories will be taken into account when your lender is deciding whether to approve your application or not. This means that even if one borrower has a clean credit history, if the other has negative listings, you may have trouble getting approved for a loan from a regular bank. In these cases it may be helpful to seek the services of a mortgage broker or a bad credit lender to help you find a loan.

      I hope this helps,

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