The most commonly used methods of buying a house are 2. You can consider buying the house in cash or getting a home loan. Have you considered applying for a home loan?
Applying for a home loan is not that easy as most people think. Apart from looking for the best mortgage lender, you have to give your financial documents to the lender.
However, people still end been denied a loan due to various reasons. In this article we will look at reasons why you might not qualify for a home loan and how to work on that.
Do you have a low credit score? It is advisable you start by checking your credit score before you think of even applying for a home loan. There are mortgage lenders that require a high credit score compared to others. Did you know you need a credit of over 760 to qualify for a home loan? Some of the ways you can improve your credit score are, paying up most of your credit card debt, make debt payment on time and dispute any errors that may appear on your credit report.
Another reason why you might be denied a home loan is having to much debt. If you have too much debt, the lender will not feel confident enough to give you the home loan, since they are not sure if you will be able to pay.
Do you have money for making a down payment for the home loan? The down payment varies among the mortgage lenders, it can be between 5{997121774900490c22003859a6cbd29a9f82ca6a55f91ed72d87a29dd2aa414d} to 20{997121774900490c22003859a6cbd29a9f82ca6a55f91ed72d87a29dd2aa414d}. To avoid getting denied the home loan, it is advisable you have some cash that you can use to make the down payment.
Do you have spotty employment records? Most mortgage lenders will check the various places you have worked in the last couple of years and how long you worked there. Most mortgage lenders what to give the loan to somebody who has their professional life in order, such a person will not have a problem paying the loan since they have a stable job.
Have you filed for bankruptcy in the past? The bankruptcy record will appear on your credit report for 7 to 10 years. However, you can consider working with a mortgage broker, they will advise you on the unconventional mortgage loans that you can apply for.
Did you know you can be denied a home loan, if you have faced a foreclosure before? Well, your dream for getting a home loan does not have to die because you have faced foreclosure before, look for a mortgage broker to help you out.
Another reason you may be denied, its if you are asking for a home loan that is too large.