Ten reasons why lenders might decline your home loan application

Why lenders reject home loans

Drilling deeper, here are 10 of the most common reasons why lenders decline mortgage applications:

• Lack of genuine savings – you don’t have a track record of consistently saving money

• Poor spending habits – you’re spending too much money, and on the wrong things

• Insufficient deposit – you don’t have a deposit of 5% to 20% (depending on the lender)

• Insufficient income – you don’t have enough money to make your mortgage repayments

• Bad credit history – you have a history of paying bills late or defaulting on loans

• Unstable employment – you don’t have a job or haven’t been in your job long enough

• New business owner – you’ve been self-employed for less than two years

• Wrong property – your property is overvalued or has low resale value

• Excessive credit card limit – you might spend money on your credit card instead of making your mortgage repayments

• Paper problems – you don’t have the correct documents or have made mistakes on your application

How to make sure your home loan gets approved

So how can you make sure your home loan application doesn’t get declined? By speaking to an expert credit advisor.

An expert credit advisor will:

• Tell you what you need to do to maximise your chances of being approved

• Recommend a lender that works with borrowers who fit your profile

• Speak to the lender to check your chances of approval