Declined for a Mortgage

You've been declined for a mortgage, what next?

If you've been declined for a mortgage, it can be a stressful and frustrating time. It may impact on your moving plans, and you're back to square one with making a mortgage application. 

The good news is that even if your mortgage application has been refused, it doesn't necessarily mean you'll be refused again.

Each lender has its own eligibility criteria, which means even if you don't meet the requirements for one lender, there will be another lender who will accept your application. This is where it makes sense to use an experienced mortgage broker who can help you to secure an approval the second time around. 

Rather than risking a second refusal and damaging your credit record, a competent mortgage advisor can make sure your application has the right information and goes to the right lenders to maximise your chances. 

Our team have helped many people like you to get the best deal possible on their mortgage, even after an initial refusal. To get started on your mortgage journey with Teito, complete our simple online form to start comparing deals. 

Can a declined mortgage be overturned?

It is very rare for a mortgage refusal decision to be overturned.

Your best chances are to speak to an expert mortgage advisor who can help you to understand why your application has been declined and whether it is best to appeal the decision or approach another lender. 

Does being refused a mortgage affect my credit rating?

Your credit report will show that you have applied for a mortgage, but will not show whether or not you were accepted.

Mortgage applications leave a 'hard search' on your credit report. This means if you are applying for multiple mortgages, you will register several hard searches, which can lower your score and reduce chances of future approvals.  

Why was my mortgage declined?

As each lender has varying criteria for mortgage eligibility, there is no one list of definitive reasons for refusal.

You can ask for more detailed information from the mortgage lender, and if you were to approach a mortgage advisor, they would be able to help you understand what to do next.  

Here are a few of the more common reasons for refusal:

• Something was uncovered in the credit search that wasn't initially declared, for example, a hidden CCJ. 
• You've made too many credit applications in a short space of time, showing as hard searces.
• You're not registered on the electoral roll.
• You haven't passed the affordability requirements. 
• You haven't demonstrated a consistent income if you're self-employed or a contract worker.
• The property doesn't meet their criteria, for example, if the property is in bad condition or is of non-standard construction.

A few tips to boost your chances of approval

There are a few things you can do to maximise your chances of approval and persuade lenders the second time around.

Find out the reasons why your mortgage application was declined

It would help if you asked the lender why your application was refused; however, you may not always find out why. A mortgage broker can help with this. You might be able to find the answer in your credit report by signing up to the major agencies, or in the property survey if the refusal was after this point. 

Improve your eligibility

Lenders will want you to demonstrate that you are a credible and reliable borrower. By reducing the amount of credit you're using, keeping up with repayments on credit accounts and improving your credit score, this will make you a more eligible applicant. 

Enhance your affordability

If the reason you were declined for a mortgage was more due to affordability criteria, there are a few ways you could address this. If you can, try to reduce your monthly outgoings, increase your monthly income, or minimise the amount you need to borrow by making use of a government scheme or putting more towards a deposit. 

Make sure your application is accurate

If you make mistakes in your application, this could affect your chances of approval further down the line. If you're not sure on some of the information, for example, how much your partner earns or when you moved into your home, make sure you take time to get the information correct and don't just guess. 

How can I apply for a new mortgage?

At Teito, we are a whole-of-market mortgage broker which means we have access to hundreds of lenders and hundreds of thousands of deals. We take the time to understand your specific circumstances and can recommend the right lender for you to maximise your chances of approval. 

Start your mortgage journey today, and we promise to make it as stress-free and straightforward as possible. 

Get started on your mortgage journey with us

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