Published on November 17, 2020
It is not uncommon for lenders to reject mortgage applications. If your application gets denied, you will instinctively want to reapply with another vendor. Before you do, it’s important to understand why you were denied a mortgage in the first place. Having too many unsuccessful applications could negatively affect your credit report, making it harder for you in the future.
Lenders reject mortgage applications for a number of reasons. Ask a mortgage broker to look at your initial application to access where you went wrong. They understand the market and are familiar with different firms’ lending criteria.
Lenders confirm your proof of address and identity by checking if you are registered on the electoral roll. Registering as a voter today can help your next application.
Your debt-to-income ratio is the proportion of debt you have in relation to your income. The higher the number is, the more debt you have, and vice versa. To improve your ratio, increase your income and reduce your debt.
Go through your credit history in advance. Dispute any discrepancies to ensure that lenders receive the right information. If you have a very low credit score, lenders may doubt your creditworthiness. See what credit habits you can improve on to make your score go up before your next application.
One of the best ways to make yourself attractive to lenders is by putting up a bigger down payment. The more money you save, the less you have to borrow.
Lenders require you to provide several documents to prove your identity, address, and income. If you are self-employed, it can be a little tricky to provide proof of income, so get an accountant to
sign off your business accounts and also prepare your tax returns.
A mortgage broker can be very resourceful in helping you find the perfect lender depending on your circumstances. Search Mortgage Solutions do not charge any fees for their services, so contact them today and talk to an expert.