Improving Chances

In today’s market of tighter regulation and limited competition, lenders more than ever can pick and choose who they want to lend money to. Historically if a mortgage application was declined it was normally due to an adverse credit history, such as defaults and arrears. However, today some applicants that have no adverse credit history are finding their mortgage application declined by lenders, with little or no explanation given. 
Before applying for a mortgage we suggest reviewing your finances to ensure that there is nothing that may be detrimental to a mortgage application.
Loan or credit card balances will affect the amount you are able to borrow, often more than you may expect. If the balance is relatively low and you are able to repay this balance without a financial penalty, it may be very beneficial to do so. Being over your overdraft facility or credit card limit will also have an impact on a mortgage application. Even one late credit or store card payment is more serious than most people believe.
Regarding affordability, many people do not realise that some lenders will accept income from sources such child benefit and family tax credits, we suggest asking the lender what incomes they will accept before an application is submitted.
Another factor that will reduce your chances of a successful mortgage application is if you fail to register yourself on the electoral register as living at your address. All lenders want to see a clear history of where you live and have lived, especially over the last 3 years.
Finally, if you are unsure of your credit history or have been declined by a lender we would always recommend obtaining a copy of your credit report to go through with your mortgage advisor.
Gary Wright CeMAP, Partner
Mortgage Advice Network Knebworth

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