Reasons Your Mortgage Application Has Been Declined

If you do find yourself declined for a mortgage application, the mortgage lender might not always be as helpful as you’d like them to be, as they won’t always tell you why. There are a lot of reasons as to why, such as possibly failing their credit checks.

It can be incredibly beneficial taking on the services of an expert mortgage broker in York, as they will be able to gauge the possibilities of why you may have been declined, as well as use the information they have on you to match you up with a suitable mortgage lender.

Some examples of why your mortgage application could have been declined are:

  • Length of time in employment or self-employment.
  • Adverse credit history.
  • Not enough deposit.
  • Non-standard property construction.
  • A married applicant applying for a sole mortgage.
  • Minimum/maximum age or mortgage term.
  • Minimum/maximum loan amount.

Failing a Credit Check for a Mortgage in York

For some applicants, especially first time buyers in York, it can be quite a challenge to pass a mortgage lenders credit score checks. You’ll find that some mortgage lender credit scores are easier to pass than others.

If you have failed to meet a mortgage lenders criteria, you might have a poor credit score or a troubled credit history. Whilst your options may be limited, there are specialist mortgage lenders out there who may be willing to work with you.

An important note to remember, is that if you do have bad credit, you may be required to put down a larger deposit and be faced with higher interest rates.

In general, however, it may just be wise to put down a larger deposit overall, as that gives you access to better deals and also widens the choice of mortgage lender.

Look to Improve Your Credit Score

There are many different things you can do to improve your credit score. Many of these are touched upon in the video below, by our very own “Moneyman”, Malcolm Davidson.

We rely on user-generated content for our videos, so if you have a similar situation and would like to ask a question, please feel free to send us a message on our YouTube channel. Alternatively, get in touch and a mortgage advisor in York will gladly answer your question.

How Can You Improve Your Credit Score? | MoneymanTV

If you have a credit card, you should use it regularly and in an ideal world, pay the balance off in full each month. It is also definitely beneficial to make sure you are on the electoral roll where you live, as that can have a big impact.

In addition to this, you should also close any old bank accounts, credit cards and store cards you are no longer using.

Failing a mortgage lenders credit search should not deter you from trying to continue with your home buying dreams. Whilst you might not be right for one mortgage lender, there may still be another who is willing to lend you what you need to buy a home.

You should always be wary of credit searches. Mortgage lenders will likely use one of two types of credit search, being a soft search and a hard search. A hard search will leave a credit footprint and will have a much larger impact on your credit score, than a soft search, which will not leave a footprint.

Furthermore, having too many credit searches, especially failed ones, can affect your credit score.

Declined for a Mortgage on Affordability

Every mortgage lender will have it’s own way of determining the amount you are able to borrow. Visiting 10 different mortgage lenders could yield 10 different results. Some are also more generous than others, being lenient to applicants who perhaps are self employed in York, when others may not.

Some mortgage lenders may also be more likely to consider assessing 100% of an employee’s overtime and bonuses, whereas other mortgage lenders may not factor this into their checks. As well as this, some mortgage lenders will accept “unearned” income such as tax credits, child benefit and maintenance.

A mortgage broker in York like us will have the ability to approach several different mortgage lenders, finding the most suitable one for your circumstances ahead of time, so you have the best chance of being successful.

Your mortgage lender will also perform an affordability assessment, in order to see whether or not you can afford to take out a mortgage. Whilst you may be able to prove that you have been maintaining monthly payments on things like rent and other loans, you are not guaranteed to pass this.

Specialist Mortgage Advice in York

Mortgage lenders all have their own individual tight mortgage lending criteria. In certain situations, some may be more appropriate than others. For example, a high street bank may not be suitable for an applicant with bad credit, whilst a niche more exclusive mortgage lender might be better.

All mortgage lenders will look to carve out niches for themselves, in order for them to attract good quality mortgage borrowers, who perhaps might not necessarily be the type of mortgage applicant other mortgage lenders are looking to do business with.

An expert mortgage broker in York like us will be able to utilise our experience of mortgage lenders and their criteria, to recommend the most suitable mortgage for you, tailored to your individual and financial circumstances.

If you have a more complex situation, then it is definitely better to seek specialist mortgage advice in York, as being declined too many times can have a seriously negative affect on your chance of obtaining a mortgage in the future. Book online today and we’ll see how we are able to help.


Last edited 06/10/2022

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