Unless you are lucky enough to be in a position to buy a property outright, applying for a mortgage is an important part of the house hunting process. Although the majority of people are approved for loans, especially if they’ve received expert advice in the run up to their application, some hopeful homebuyers will have to deal with the shock of being rejected.
If you’re recently been turned down for a mortgage, don’t panic. Although one mortgage provider may have denied your application, there may well be another lender out there who will ok your loan. Boost your chances of getting a mortgage and securing your dream home by following these easy steps.
Don’t apply for another mortgage straight away
As @HomesProperty says, “Whatever you do, do not instantly apply for another mortgage with a second provider. Multiple applications can damage your credit score and if you don’t know why you were turned down then you risk it happening again.” Although it may be tempting to apply for another mortgage straight away in order to keep your house hunt on track, resist that temptation. Take a deep breath and pay your mortgage application a little more attention.
Find out what went wrong
Before you apply for another mortgage, you need to find out what when wrong with your first application. A lot of the time, mortgage applications are rejected because of a poor credit score. Sign up to a website that allows you to check your score to see if this is the root of your problem. If you find out your credit score is below average, you need to set about improving it. Set up a few direct debits from your bank account, get a credit card and use it responsibly, close any credit card accounts you no longer use and make sure any debt is kept to an absolute minimum.
Another factor that could have affected your loan application is your income. If you’re applying for a large mortgage, or if you have a very small income, a lender may be concerned that you’d be unable to meet the monthly repayments. Alternatively, if the deposit you’ve saved is too small to meet the minimum loan-to-value threshold for your mortgage, your provider may have seen this as a reason to reject your application.
If you’ve been declined a mortgage, getting expert advice is more important than ever. An experienced financial advisor will be able to talk you through what when wrong with your application and help you find a loan that’s more suitable for your needs. They’ll be able to check you meet the mortgage provider’s criteria before you apply, helping to ensure your next application is successful.
Find out more about the mortgages available to you, or talk to one of our expert advisors, by getting in touch with a member of our team today.
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Written by: Cambridge Web Marketing