Getting a mortgage is like an expedition where mistakes can invite the threat. Why not know about them beforehand and avoid to prevent any last-minute disappointment? Here are some points that describe the factors that stop you from attaining funds through a mortgage for a property purchase.
Mention of gambling transaction in the bank statement- Oh No!!!
Lenders do not want even the least risk on their money. Gambling usually proves a person careless and spendthrift. Mention of betting payments or money to bookies in your bank statement can undoubtedly make the lender reject the application.
Generally, a solution to this issue is, make all such payments through credit cards. Above all, do not indulge in gambling activities because it is not about mortgage only; your whole financial life gets into the threat.
Having no credit history-Not a safe play strategy
A lender needs to see a payment history to get a hint of how responsible you are towards the credit payments. If there is nothing to see, it isn't easy to rely on the repaying capacity of the applicant against a hefty obligation of a mortgage.
One more big loss of no credit history is that your credit score remains low. As a remedy to this condition, you can take any kind of credit 6 to 12 months before applying for a mortgage. But that should be a short-term, small size financial product, as you also need to take care of the credit mix. Otherwise, a lender can't have confidence in the financial capacity of a first-time buyer.
Closing a credit card account- Who said it is a wise thing?
Usually, those with a considerable credit card debt think that closing a credit card account can improve their mortgage chances. However, it reduces the credit history length, which ultimately hurts the possibilities of approval.
The better choice is, make payments on time and keep the financial record spotless. Closing the account is not always an advisable thing. It should be done only when you can bear a drop in the credit score, or are fed up with the fees and high rates. It is perhaps better to take expert advice on this matter and do not do experiments. There are many good mortgage brokers in the UK that can give a due suggestion on this aspect.
Switching jobs frequently? Oops!
Employment stability is always a significant factor, and if that is absent in your case, the lender may not show interest. Frequent switch of jobs is suicidal for mortgage chances. In the last one-year duration before applying for the mortgage, you should be in the same company.
Instability in the career of the fund seeker makes the finance companies think that the finances of such a person are not healthy. Also, the person is not serious about life and the future and changes jobs repeatedly. The same can happen in the case of repayments with a result of missed or delayed installments. Stay in the same job as much as possible; it always leaves a good impression.
Incomplete documents – That is careless
Don’t mind, but it is one of the silliest things to do to yourself. Seriously!! There are so many things that the lending companies need to check on the part of repayment capacity and employment status. For the purpose, they demand varied kinds of documents, and if they are not complete, they cannot calculate affordability.
Always prepare a list of documents you need to provide to the lender. Gather them, keep them safely in a folder and before sending the application, match the list.
The above deeds are the mistakes that one can do before making a mortgage application. Now when you know about them, avoid before they occur. Sometimes the difference between approval and rejection is only of one small mistake. Ignorance about the facts makes you take the wrong turn. Stay informed and play safely in the mortgage market. ALL THE BEST!!
