Can I get a Mortgage if I’ve been Declined or Refused?
You have just had an application for your mortgage declined – what do you do now?
Being refused a mortgage isn’t the end of your home buying dream, but what you do next is very important.
Do not apply to another lender until you know why you were declined!
I see it so often when I am reading a client’s credit file that they have numerous credit searches from different mortgage lenders and I know from experience, there is not a chance that those lenders would have lent to them.
The more times you apply for a mortgage to lenders that leave a ‘hard’ credit footprint on your file, the less chances you have of being offered a mortgage.
One common reason is failing credit score, the most annoying reason a lender can offer. On the day you applied you simply did not have enough points. You could apply tomorrow however, with the same lender, and pass because the lender has changed their point’s allocation. But there are ways to make sure you give yourself a better chance of passing. Have a look at the Boost Your Credit Score page on my website but here is one to remember when you are completing the mortgage application form.
Complete every single box or section on the form because every answer you give will be allocated a score. If you leave out a telephone number you may lose a point, miss out a full 3 year address history and you will lose even more points. You will never know how many points you had, but give yourself the best possible chance by completing the form fully.
Finding a home and applying for a mortgage can be a very stressful time, and nothing adds to that stress like having your application declined or rejected. But being refused isn’t the end of the road though.
Since 1986, I’ve helped people in your position to find a lender prepared to take another look at your application, putting you a step closer towards owning your own home or property.
Only a handful of sub-prime lenders currently operate in the UK property market, so you have to get your second-chance application right first time to avoid more rejection and refusals. And that’s just what I’ll do.
The first step to doing this is finding out just why your application was refused?
Why was my mortgage application refused?
Before I can help you find a mortgage, we need to discuss your current financial situation. You’ll need to share your credit history and details of your income, and tell me how much you’re looking to borrow to finance your property purchase. Then we’ll look at why you were refused and find a way around it.
In my experience, the most common reasons for applications to be refused are as follows:
- Poor Credit Scores
- Existing Debt
- County Court Judgements (CCJs)
- Debt Management Plans
- Debt Relief Orders
- Director Guarantees
- Individual Voluntary Arrangements (IVAs)
- Mortgage Arrears
- Pay Day Loans
- Low Credit Scores
- Low Income/Small Deposits
All of these rejections have one root reason. Lenders don’t like to take any risks.
If you have a poor credit history, lenders won’t want to approve your mortgage. I’ll examine your credit history with you and if there is incorrect information that’s holding you back, I’ll show you how to correct it – top tip is to dissociate yourself from a previous partner on your credit file.
If you’re already in debt, lenders may not want to add the burden of mortgage payments onto your stretched finances. I’ll help you to find lenders who may be more flexible in their underwriting criteria or help you to understand how to manage your debts so that lenders can see you can take on the responsibility of a mortgage. All this should give you a better chance of a mortgage in the future.
Many lenders are put off by issues such as CCJ’s, IVA’s and Bankruptcy – even if your CCJ was the result of an illness or redundancy leading to a missed instalment of your credit card bills. However, depending on the time since your issues, and the amount of money involved, I may be able to find a lender willing to approve your application.
The best advice I can give you is to be realistic about the mortgage you can afford. If you have a lower income or smaller deposit than your lender is looking for, your mortgage is likely to be refused. If your income is a barrier to the home you want, I’ll advise you on alternative lenders, and look at different kinds of mortgages.
No matter why your initial lender declined your mortgage, I’ll help you to find an alternative.
Information held on your credit file
The information held on your credit files is very important as lenders use these agencies to look at your credit history for the past 6 years. If you have been drefused a mortgage and the lenders say ‘have a look at your credit file’ you can bet you have something adverse on there.
When you call me, it would help if you had a copy of your file to hand from Check My File as they provide data from the three Credit reference agencies lenders use – Equifax, Experian and Call Credit – so it is a good place to start to get an overview of your credit history. It maybe that once I have identified a lender, we get copies of your credit file directly from the agency the lender uses to make absolutely sure your credit history is OK for that particular lender.
How can I help you with a refused mortgage application?
As a mortgage adviser I’m not tied to any single lender. Because of this, I’m on your side and it’s my job to find you a lender willing to approve your mortgage application.
As I explained above, I’ll have a no-obligation discussion with you to determine the reason for your rejected mortgage application and your current financial situation. I’ll then give my honest opinion on your prospects and help you to prepare an application to a sub-prime lender.
It’s vitally important that your application is correct, as you’ll only have one chance to avoid having another application declined. Fortunately, I can draw upon my years of experience to make sure you have the best possible chance of having your application approved.
Take your first step towards owning your home by calling on 01494 526400 or 07949 713563 to discuss your mortgage requirements. I’ll do everything I can to make sure the next thing you hear from a lender is “Yes!”
If you would like further information on how I can help you if you have had a mortgage declined or refused complete my online enquiry form.