Mortgage applications therefore can often prove a lengthy process, with a number of steps required to eventually secure the loan. For those who are applying for a mortgage, it is usually the case that a large amount of documentation is required to process this. A detailed record of income and outgoings are required, as well as details of other earnings such as investments or benefits.
Sadly, the impact of COVID-19 has meant more people have been turned away for a mortgage than before.
Research from Butterfield Mortgages, which studied more than 1,300 UK adults, revealed 50 percent of homebuyers had been denied a mortgage in 2020 – even after they had been offered one in principle.
As a result, before commencing a complicated mortgage application process, many will wish to know how they can avoid rejection.
Express.co.uk spoke to Michelle Stevens, Mortgage Specialist at finder.com, to discuss the reasons why hopeful homeowners could be rejected in their mortgage application.
READ MORE: Mortgage holidays could have an adverse effect on Britons
This is, of course, when other outgoings are taken into account, so an organised record is key.
She added: “Perhaps an overlooked but basic thing for budding homeowners to do is check how big a mortgage they will qualify for on their income.
“This is so they are not over-reaching in terms of affordability and applying for an amount they might get rejected for.
“There are mortgage calculators readily available online that will give you a rough guide on how much you can borrow before you start shopping around for a dream home.”
The Money Advice Service has also drawn Britons’ attention to several reasons as to why a mortgage application could be rejected.
By and large the most significant issue appears to be one surrounding a person or couple’s credit.
A poor credit history, or too many credit applications can have an adverse effect on those hoping to clinch a mortgage.
Current loans and debt, in a similar way, are likely to affect the chances of lenders offering a mortgage to Britons.
And, perhaps an overlooked reason as to why a mortgage is rejected is not being registered to vote.
The Money Advice Service website states: “You need to be on the electoral register at your current address so lenders can confirm who you are and where you live.”
But thankfully, Britons may not need to worry too much going forward.
The Intermediary Mortgage Lenders Association has said that on average, three out of four borrowers are accepted for a mortgage.
As long as the aforementioned points are addressed, Britons are therefore likely to have success in securing a mortgage.