Considering that most buyers will need to apply for a mortgage to become homeowners, it can be particularly devastating to be rejected or denied a mortgage. This situation can potentially be avoided by taking better steps before even applying. It’s important to remember that not all mortgage programs are designed the same, requirements may differ.
Before filling out a mortgage application, it’s best to contact a mortgage professional who can work with your unique situation and present options that suit you the best. Your credit profile should be looked at before reaching the application process, that way you can be presented loan products that are appropriate for you. This step is particularly important since being declined for a mortgage may negatively affect your credit score. What’s worse, the rejection letter won’t explain why you were turned down, nor will an underwriter provide any information on your rejection.
When you apply for a mortgage, lenders will take a look at your assets, credit, and income, all of which factor into your eligibility. However, the amount of debt shown on your credit report can become the biggest roadblock.
Before you apply, make sure you know what’s on your credit report, be aware of the type of income that counts towards eligibility, and make sure to pay off as much debt as possible. And remember that before you apply, speak to a local, reputable mortgage broker first.