Getting a home loan approved when you have a poor credit history is easier than you might think. If your credit history is poor you may still be able to qualify. Yes, you'll most likely pay a higher interest rate than you would've if you had perfect credit but with the current interest rates as low as they are you will still get a pretty sweet deal.Having a deposit sorted of say up to 20% of the list price of the house will definitely improve your chances of getting approved for a mortgage despite your bad credit history and might just chop a couple of points off the interest the bank would have charged you.
Just telling the people at the bank or your mortgage broker that you're a responsible person... unfortunately won't cut it. You'll need to be able to prove it. How? Well, how long have you been working at your job? Have you had a long standing relationship with the bank you are currently with and they can see by your records that you've been responsible with your cash. You've put away savings over a period of time? Many factors can help when applying for a loan and help the lenders get a picture of you and your financial habits.
Having said this, finding which lender is ideal for your situation can be tough. In extreme situations where the "everyday" banks such as ANZ, Westpac etc won't lend due to previous credit history, you'll need top to find a boutique lender to help you out.
Your situation could be that you have no genuine savings (genuine savings are savings acquired over time not a lump sum gift etc) and want to purchase a house at 95% LVR but have a few defaults on your credit history. At some point in time fortune may not have been on your side and you became bankrupt (or bankrupt several times). You may have only recently become discharged from bankruptcy, some banks won't even look at you. Another common no-no for banks is loaning to a self-employed home loan applicant that has only held an ABN for several months.