5 reasons you might get turned down for a mortgage
So you’ve denied yourself holidays and new gadgets, you’ve moved to a less desirable part of town, maybe even moved back in with mum and dad, you’ve done all it takes to scrape together that deposit….
You’ve clicked through thousands of properties online, traipsed through the streets of one dodgy neighbourhood after the other. You’ve compromised on having a garden or a garage or a second bedroom. You’re within reach of landing your dream home, or even just your dream of owning a home, all you need is that mortgage. If that’s you, listen up!
In a recent Rightmove survey, we asked respondents the main reason they were turned down for a mortgage and these were the top five:
- 1. Low credit score
- 2. Insufficient deposit
- 3. Bad debt history
- 4. Failed affordability assessment
- 5. Self-employment/gaps in employment history
The list remained broadly the same across buyer groups with a slight reshuffling of the top positions. First and second time buyers were primarily turned down for low credit scores while bad debt history was the main deal breaker for those purchasing a home for the third time or more. For investors, the leading cause for refusal was self-employment/gaps in employment.
So, while scaling the deposit hurdle and finding a suitable home (the two biggest concerns about buying as stated by 66% of our survey respondents) are major achievements for prospective buyers in today’s housing market, make sure you’ve considered the list above before you take that final step and apply for a mortgage.