With recent changes to lending requirements, it is becoming harder and harder to obtain finance. If you are one of many who’s mortgage application has been declined, don’t panic just yet! The market is diverse with lenders offering an array of different criteria for mortgages, and one setback does not mean that you won’t receive finance through another bank or finical institution.
If your finance has fallen through, there are steps that can assist with getting back on track for an approval the second time around.
- Ask why
First things first, you need to understand why your application was rejected. Your lender should be able to tell you the reason for their decision which you can then work on fixing. It may have been as simple as missing a question in the forms or as complicated as a poor credit rating.
- Check your credit history
Often, applications are rejected because of a bad credit history. Before you apply again, you will need to solve any outstanding issues with your credit file. Bad credit histories are one of the most common reasons loans get rejected and more often than not, the bad rating has come from something as minor as an unpaid phone bill.
Remember to always pay your bills on time- the more reliable you appear financially, the more you will appeal to lenders.
- Explore your options and seek professional assistance
Don’t just apply with the next lender you come across. It’s important to research different home loan options in order to make the most informed decision about which will suit you best. Working with a mortgage broker is a great way of alleviating the work and stress that come along with choosing a lender. A good broker will have access to numerous lenders which they can compare to find the best option for you- and best of all, their services are free!
- Debt consolidation
If your existing debt was the reason for the rejection you may want to look at clearing some before applying again. Another option could be debt consolidation or reducing your credit card limits. A mortgage broker can advise on the best direction for you.
- Remain realistic
One set back does not mean it’s all over. There are plenty of lender options out there so there is good chance that one will match your needs, but you may need to be more realistic about what you can afford.
If you are rejected for a loan the key is not to panic. Loan rejection isn’t uncommon and it doesn’t mean that you will never be able to secure finance… Talk to one of our brokers today!