Anew Lending Shares Tips on What You Should Do After Your Mortgage Is Denied
Many people looking to buy a home may face denial after applying for a mortgage. Anew Lending, a mortgage lending company in Sacramento, offers advice on what to do if your mortgage application is denied.
These tips include finding out the reason for the mortgage denied decision and improving your chances the next time you apply for a mortgage.
Why Was the Mortgage Application Denied?
The first thing to remember is that a mortgage loan denial does not mean a mortgage can never be obtained. First, the reason for the “Mortgage Denied” decision needs to be identified. The lender must provide the reasons the mortgage was denied. Those reasons may include:
- Changes to your credit score: Many things can affect the credit score, from credit checks too late payments, new personal loans, or significant purchases like a car.
- Too much debt: Carrying sizable debt may be a mark against the applicant even if they make on-time payments.
- Employment status: Getting a new job or being laid off or fired can be a mortgage denial.
- Income changes: A pay cut could make it difficult to meet mortgage payments regularly, leading to a mortgage denial.
What To Do Before Reapplying for a Mortgage
If a problem with credit history was the reason for the denial, Anew Lending recommends scouring through your credit reports. Look for any errors or outdated information that likely caused the mortgage denial and contact the credit bureau to correct it.
A lack of credit history may also cause denial, and the only solution for that involves building up the applicant’s credit profile. A secured credit card or credit-building loan provides two options, as does report on-time rent and utility payments to the credit bureaus. Making payments on time has a profound effect on credit scores.
For some debts, such as student loans, lower monthly payments may be negotiated to keep payment obligations on time and allow those still paying off their education the opportunity to purchase real estate. Student loans in arrears may also be rehabilitated after months of regular payment, removing them as a negative mark from the credit report.
Anew Lending Mortgage is a full-service direct lender located in Sacramento, CA. They specialize in loans for first-time homeowners and refinancing for current home loans. With a wealth of resources and years of experience helping families obtain the mortgage they need, they believe homeownership strengthens our communities and families.
If you have had a mortgage denied and are ready to reapply, Anew Lending’s experienced team of loan officers and brokers are prepared to assist you through the entire process. If you are interested in an interview with one of our team, please contact our Sacramento office at 916 226-9991.
Do you know what mortgage post-closing is? Could you read about it here?
