Throughout the tough financial times of the last decade or so, securing a mortgage offer has become increasingly difficult as banks and lenders have tightened their regulations to try and protect their businesses. The knock on effect of this however, is that people who by all rights can afford a mortgage and should have no trouble paying it off are being turned down for increasingly picky and sometimes outright petty reasons. That being said, the overly carefree attitude banks had to mortgages back in the late 1990’s and early 2000’s has been a huge contributing factor to the global economic crisis.
This leaves perspective borrowers in a difficult position; you need to make sure your lender is going to be happy with your application and your financial history otherwise you might get refused your mortgage. Just to make matters worse, if you get rejected too many times, for whatever the reason, it can make it even more difficult to get accepted in the future. One tactic lenders might employ is to make you an offer, but at a higher interest rate to ‘represent’ the risk to themselves, and obviously this isn’t great for you. There are some things you can do to improve how you are perceived by lenders though, so here are a three suggestions that should help.
Handle loans properly
There are two simply rules with loans when applying for a mortgage. Pay off any existing loans and debts if at all possible as this will free up your borrowing ability, and never, ever use a short-term of payday loan company. These leave a terrible mark on your credit history and make it look like you cannot manage the expenses you have, let alone a mortgage as well.
Accept help as gifts
Make sure that if you are receiving help from parents, grandparents or whoever with your deposit of clearing loans that the money is sent to you with a letter or some evidence that it is a gift and you are not expected to repay it. If you don’t, then lenders may well consider it another loan, even if you tell them it isn’t; without signed proof they do not have to change their approach.
Use a good estate agent, mortgage broker and solicitor
Together, these three will cover all aspects of buying your property and having quality people you can trust will make this a whole lot easier and more efficient. Directly regarding your mortgage, you should always be checking the reviews and backgrounds of anyone you are considering to ensure that you find a reliable mortgage broker in Brisbane, Sydney, Melbourne or wherever else you may live. This means that you will receive effective advice on securing the best mortgage product for your needs and your broker will also be very aware of how picky certain lenders are being, any caveats that they may have and be able to advise you accordingly.
There are far more things that you can do to improve your standing with mortgage lenders, but these three things will certainly help improve things a lot and hopefully help you secure the mortgage you need.